LONDON (Reuters Breakingviews) – MONEY ON THE MOVE. Africa’s mobile money revolution is attracting a big hitter. Global payments giant Mastercard on Thursday announced it’s investing $100 million into Airtel Africa’s cash-transfer unit, which lets users zap each other money via basic mobile phone handsets. The deal values the division, which operates in 14 countries, at $2.65 billion, over a third of its parent’s total enterprise value.
The valuation of 12 times the unit’s expected EBITDA this year, compared with the 4 times multiple at which its parent trades, may prompt other African telecommunications operators to go digging for value in their mobile money coffers. By the same yardstick M-Pesa, the pioneering mobile payments offering owned by $13 billion Kenyan operator Safaricom, would be worth $4 billion, assuming revenue of $660 million this year and an EBITDA margin similar to Airtel’s 49%. With the continent’s mobile phone markets increasingly saturated, operators see sense in jumping on the payments revolution rumbling round the globe. (By Ed Cropley)
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