MTN Nigeria shareholders approved on 30 April 2026 the transfer of majority control of the company’s fintech operations to parent company MTN Group in a restructuring valued at ₦152.06 billion. The transaction sees MTN Group acquiring a 60 per cent stake in both MoMo Payment Service Bank and Y’ello Digital Financial Services for ₦95.5 billion, while MTN Nigeria retains 40 per cent ownership, shifting the financial burden of loss-making fintech businesses to the group level.

The approval, secured through Resolution 9 at MTN Nigeria’s Annual General Meeting, represents a strategic pivot. It reflects the reality that scaling fintech requires capital and risk tolerance beyond what a telecommunications subsidiary operating in Nigeria’s macroeconomic environment can sustain while maintaining dividends and balance sheet strength.

The restructuring will be executed in two phases. Phase one involves MTN Group Fintech B.V. acquiring 60 per cent equity through a mix of newly issued shares and the purchase of existing MoMo shares from MTN Nigeria. The ₦95.5 billion valuation, assessed on a debt-free, cash-free basis, implies a ₦152.06 billion capital injection through cash, non-cash consideration, or a combination.

Phase two will establish a financial holding company, Fintech HoldCo, owned 60 per cent by MTN Group Fintech and 40 per cent by MTN Nigeria. Subject to Central Bank of Nigeria approval, the entity will acquire all shares in MoMo and Y’ello Digital, consolidating fintech operations under a single regulatory structure.

MTN Nigeria acknowledged that its fintech subsidiaries are loss-making and weigh on consolidated earnings. The restructuring spreads operational risk across the group, allowing MTN Group to absorb capital requirements and regulatory obligations while reducing MTN Nigeria’s direct exposure to ongoing losses.

The move reverses MTN Nigeria’s August 2024 acquisition of Acxani Capital’s remaining 7.17 per cent stake in MoMo for ₦6.95 billion, which had brought its ownership to 100 per cent. Within months, management determined that full ownership increased capital pressure as fintech expansion outpaced returns, creating a negative cash flow cycle.

MoMo Payment Service Bank operates a mobile money platform offering deposits, transfers and digital wallet services. Y’ello Digital Financial Services functions as a licensed super-agent, providing agency banking services such as cash deposits, withdrawals and bill payments through the MoMo network.

Despite losses, fintech revenue showed strong growth. In Q1 2026, core fintech revenue rose more than 190 per cent, excluding XtraTime, a suspended airtime lending product. The growth highlights strong demand but also underscores the challenge of profitability given high infrastructure, compliance and customer acquisition costs.

The restructuring mirrors MTN Ghana’s spinoff of its MoMo business into MTN Mobile Money Fintech Limited, completed on 31 March 2026. The Ghana model now serves as a template for Nigeria and Uganda. MTN Group CEO Ralph Mupita has long advocated separating fintech operations, estimating a potential standalone valuation of $5 billion to $6 billion.

KPMG validated the ₦95.5 billion valuation, describing the transaction as fair and reasonable. MTN Nigeria’s board expects the restructuring to improve financial ratios, strengthen liquidity and support more sustainable dividend performance as fintech losses no longer fully impact earnings.

The company aims to complete the transaction by 31 December 2026, subject to regulatory approvals and final conditions. This timeline allows for review while positioning MTN Nigeria to reflect the benefits in its 2027 financial results.

The restructuring highlights a broader industry reality. Telecom operators expanding into mobile money face profitability challenges despite strong user growth. Building payment infrastructure, maintaining compliance and competing with financial institutions require capital intensity that telecom subsidiaries struggle to absorb alongside core operations.

The move also reinforces MTN Group’s Ambition 2030 strategy to position itself as a leading connectivity, fintech and digital infrastructure provider. By centralising fintech assets, the group can allocate capital more efficiently across markets rather than managing fragmented operations within individual country subsidiaries.

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