The telecom giant MTN Uganda plans to restructure its mobile money business by separating it from its direct ownership and transferring operations to a newly formed company through a merger. The new entity will be jointly owned by MTN Group Fintech Holdings B.V. — a global entity overseeing MTN’s financial technology operations — and a trust benefiting minority shareholders, who hold 23.9 per cent of MTN Uganda.
MTN Mobile Money (U) Limited (MTN MoMo), a wholly owned subsidiary of MTN Uganda, will merge with a new entity, MTN New FinCo, which will become the surviving company, according to a circular released to the Uganda Securities Exchange. MTN New FinCo will operate as a provider of payment systems and digital financial under the National Payment Systems Act (Cap. 59). MTN also stated that it plans to list MTN New FinCo on the Uganda Securities Exchange in the future.
The merger is still subject to approval by the Bank of Uganda, which will grant the relevant licences under the National Payment Systems Act. It will also have to be approved by the Uganda Revenue Authority, the Capital Markets Authority, the USE, and the commissioner for labour. MTN assured its stakeholders and customers that its mobile money and fintech services will continue as normal during the transition, which will not affect ongoing business operations.
According to the telecom, the separation of MTN MoMo is part of its Ambition 2025 strategy, which focuses on building digital financial platforms and adapting its business model to capitalise on global technological growth and innovation.
The proposed transaction will be presented to shareholders at an extraordinary general meeting scheduled for Wednesday, 2 July 2025.
Read more: MTN Uganda: Notice of extraordinary general meeting
MTN Uganda, the country’s largest telecom, was listed on the Uganda Securities Exchange in 2021. Prior to its listing, the company legally separated from its mobile money unit in compliance with the National Payment Systems Act, which required MTN to establish MTN MoMo as a standalone subsidiary for issuing electronic money.
Following the split, MTN will no longer consolidate the earnings of its telecoms operations and MTN MoMo, as it has done since 2021. Instead, shareholders will receive separate earnings reports, and the two entities will hold independent shareholder meetings and issue separate dividend payments. MTN shareholders will, however, still have the right to participate in the governance and shareholder meetings of MTN New FinCo, and will be directly entitled to dividends paid by the new entity.
The telecoms company advised its shareholders and the general public to exercise caution when trading MTN shares. It added that further announcements regarding the status of the proposed transaction would be made in due course.
MTN Uganda’s stock price closed at Shs269.57 on Wednesday, which was 0.53 per cent higher than it opened.
