LAGOS (Reuters) - South Africa’s MTN (MTNJ.J) aims to list its Nigerian unit in an initial public offering this year and has struck an agreement with pan-African lender Ecobank (ETI.LG) to offer mobile banking across Africa, its group chief executive said on Tuesday.
The move comes as telecoms operators are expanding mobile services to boost margins and access new revenue streams.
Rob Shuter said plans for the IPO were well advanced and the company would provide exact terms in the next few months.
He was speaking in Lagos after MTN signed an agreement with Ecobank to form a partnership on mobile banking across Africa.
“We are well advanced with the Nigerian listing. If market conditions are appropriate we should conclude it this year,” Shuter told Reuters.
He added the South African telecoms group was targeting 60 million customers via mobile services over the next three years, up from 23 million now across the 14 markets where it has launched the product.
MTN and Ecobank’s agreement on a mobile banking partnership came on the heels of an announcement by Kenya’s top three telecom companies on Friday to offer cross-network money transfers by mobile phone.
In a separate development, the Nigerian Communications Commission (NCC) - the telecoms regulator - said on Tuesday it had signed a memorandum of understanding with the central bank to boost the use of mobile banking.
Godwin Emefiele, the central bank governor, said the aim was “to produce a payment system in Nigeria, reducing cash transaction and enhancing cashless operations”. He said the target was to ensure 80 percent of Nigerians had access to financial services by 2020 compared with 40 percent now.
In Nigeria MTN’s rival, investment holding company Teleology, has partnered with East Africa’s largest telecoms operator Safaricom to offer mobile services. Teleology Holdings agreed in March to buy 9mobile, Nigeria’s fourth largest telecoms provider.
Shuter, a former Vodafone European head, who became MTN’s chief executive last year, has a background in banking, and is looking for new revenue streams as competition and regulation hit profit margins.
Shuter said MTN was building its mobile services business, which is an important part of its digital growth strategy, and it saw a lot of common ground with commercial banks.
“Ecobank has very similar aspirations to us,” he said.
Ecobank, which operates in 36 African countries, has said it expects its digital banking platform to boost its customers to 100 million from 13 million by 2020 and that it will focus expansion on existing markets via low cost mobile services to tap customers on lower incomes.
Reporting by Alexis Akwagyiram; Additional reporting by Camillus Eboh in Abuja; Writing by Chijioke Ohuocha; Editing by Susan Fenton, Alexandra Hudson and Mark Potter