MTN Nigeria, the leading telecommunications provider in the country, has successfully acquired the remaining 7.17% minority stake in MoMo Payment Service Bank for a sum of N6.95 billion. This strategic move is aimed at strengthening MTN's presence and influence within the financial services sector.
The acquisition was disclosed in MTN Nigeria's unaudited financial report for the nine-month period ending September 30, 2024. In May, MTN had finalized an agreement with the minority shareholders of MoMo PSB to acquire their shares, thereby moving closer to achieving full ownership of the bank.
This transaction is part of MTN Nigeria's comprehensive strategy to expand its influence in Nigeria's financial services landscape through MoMo PSB, which provides a variety of digital banking solutions designed to promote financial inclusion.
With this acquisition, MTN Nigeria intends to utilize MoMo PSB’s mobile banking capabilities to enhance customer convenience and boost revenue from the expanding digital finance sector.
In May 2024, the non-controlling interest holders in MoMo Payment Service Bank proposed selling their 20 percent stake, which had been reduced to a 7.17 percent minority interest, to MTN Nigeria Communications Plc. MTN Nigeria accepted the proposal and paid N6.95 billion as the agreed purchase price.
The telecommunications company indicated that this acquisition was recorded as an equity transaction, leading to a N12.97 billion adjustment in MTN Nigeria’s retained earnings.
This adjustment reflects the variance between the valuation of the non-controlling interest in MoMo PSB and the actual payment made by MTN Nigeria, in accordance with International Financial Reporting Standards 10.
MoMo officially commenced operations in Nigeria on May 19, 2022, following the final approval granted by the Central Bank of Nigeria in April 2022.
The launch occurred after a successful pilot program that commenced on May 16, 2022, coinciding with the anniversary of MTN's GSM services.