MTN Group to acquire 60% stake in MoMo and Y’ello Digital for N95.5 billion

MTN Group has revealed plans to acquire a 60% stake in each of MTN Nigeria’s Fintech platforms, MoMo Payment Service Bank Limited (MoMo PSB) and Y’ello Digital Financial Services (YDFS) Limited. The transaction is expected to be worth N95.5 billion.

According to an explanatory note to stakeholders filed with the Nigerian Exchange (NGX) on Tuesday, the acquisition is necessary to make a “substantial financial investment” in the fintech subsidiaries. 

The explanatory note added that the deal forms part of the group’s Ambition 2030 strategy to become Africa’s leading Connectivity, Fintech, and Digital Infrastructure platform business. 

Following the acquisition, which is expected to be completed by 31 December 2026, MTN Group, through MTN Group Fintech, will hold a 60% stake in both fintechs while MTN Nigeria retains the remaining 40% stake. 

As part of the deal, MTN Group will be investing N152.06 billion in the Fintech companies. 

“MTN Group (via MTN Group Fintech B.V.) will invest N152.06 billion for a 60%  stake in the fintech subsidiaries. This will be executed through a combination of primary injection of capital into the fintech subsidiaries and a secondary acquisition of shares directly from MTN Nigeria, while MTN Nigeria will retain 40%,” part of the statement reads.

Upon the completion of the deal, both MTN Group and MTN Nigeria are expected to transfer their respective stakes in the fintech subsidiaries into a new Holding Company registered with the Central Bank of Nigeria. 

While dealings are still in a preliminary stage, MTN Nigeria will be making an official presentation of the deal to shareholders during its Annual General Meeting on 30 April 2026. 

However, the deal is entirely subject to approval by the Nigerian regulators.

Also Read: 8 startups win N49m at MTN-Powered “Gathering on 100” Pitchaton event.

Why the MTN Group deal is necessary 

The birth of the deal emanates from the need to ease MTN Nigeria’s operational affairs. 

According to the explanatory note, MoMo Payment Service Bank Limited (MoMo PSB) and Y’ello Digital Financial Services (YDFS) Limited are currently loss-making, which is weighing on MTN Nigeria’s financial performance. 

As a result, the introduction of the separation allows the group to have greater control over the fintech subsidiaries’ operations and also to inject funds.

MTN Nigeria said the deal will inject funding and “restructure the ownership and operating model of the Fintech Subsidiaries to accelerate growth and to better capture emerging opportunities within the digital financial services market.”

Following the structural separation, the losses incurred by the fintech subsidiaries will no longer be consolidated into MTN Nigeria’s financial statements. This is expected to improve the telco’s overall performance.

As the group will be mainly responsible for the fintechs’ capital expenditure (CAPEX), this means that MTN Nigeria will no longer need to commit as much funding to support the fintechs. This allows the operator to further strengthen its balance sheet and allocate capital to drive growth in its core connectivity platform. 

“As a result, the company’s ability to pay dividends is expected to improve or, at the very least, remain stable,” part of the explanatory note reads.