Some MTN shareholders are wondering what gains or risks the restructuring will have on their interests. PHOTO / EDGAR R BATTE
It’s getting unsettling – and from the look of things, MTN must start preparing all the right answers.
Tensions are building over MTN’s mobile money business, its cash cow, raking in profits, recording fast asset growth, and returning generous dividend cheques.
MTN has already notified shareholders that it wants to carve the mobile money unit into a separate business to steer it toward “strategic” investors.
Why? By bundling mobile money with other African Fintech units, MTN Group hopes to attract big-ticket capital and scale rapidly, possibly chasing unicorn status.
It’s a rich unit, with a story that lies in the numbers. In 2024, MTN Mobile Money, which is now a subsidiary of MTN Uganda, raked in Shs982b - 31 percent of the telecom’s revenue.
With Shs1.63 trillion in assets and Shs260b in profit, it paid out Shs303b in dividends - 60 percent of the company’s total.
If listed as a standalone, MTN Mobile Money would rank as the second-largest dividend payer on the Uganda Securities Exchange (USE), behind Airtel Uganda’s Shs315 billion and ahead of Stanbic’s Shs300b.
Fintech is no longer a sideshow. It’s now the engine - leaner, faster, and more scalable than traditional banking.
While banks face regulatory drag and heavy overhead, Fintechs thrive on speed and simplicity.
Both MTN Mobile Money and Airtel Money now out-earn most banks: Airtel Money made Shs311b in 2024, while MTN Mobile Money made Shs260b.
Compare this to league one banks such as Absa (Shs178b) and Equity Bank (Shs20b), then you will know where the fortunes have settled.
And projections indicate mobile money companies will outearn even larger, established, and traditional banks.
However, here is the twist.
When MTN was listed in 2021, the mobile money unit was listed as a subsidiary.
Yet, the telecom has now alerted shareholders of an extraordinary general meeting in which they will vote to separate the mobile money unit from the listed company next month.
Separating operations is legal. Separating ownership? That’s where things get murky - and where retail investor anxiety kicks in.
If mobile money is taken private or absorbed under MTN Group’s Africa Fintech arm, will listed shareholders still benefit?
“Right now, mobile money’s profits flow to MTN Uganda, and shareholders reap the gains. If they extract mobile money, will listed shareholders still benefit - or be cut out?” a source at USE wonders. Well, it is a whole lot, but MTN has offered some explanations.
The offer
In a June 10 circular, MTN indicated minority shareholders will retain exposure to the mobile money unit through a Trust registered in Uganda and holding a 23.985 percent stake in the MTN new FinCo.
This would be representative of the current holdings that shareholders hold in the listed company.
However, retail investors won’t hold shares directly. Instead, their stake adjusts with their MTN shareholding. Institutions will own shares in the new FinCo directly.
While MTN's chief executive officer, Sylvia Mulinge, has promised that the structure will protect minority shareholders, many say the details remain too vague.
Airtel used a similar playbook. Before its 2023 IPO, it spun off Airtel Money to remain under Airtel Africa. Investors bought into Airtel Uganda, minus the lucrative mobile money business. Strategic? Yes. But for whom?
Unhappy shareholders
On June 30, a group of MTN Uganda shareholders formally lodged a complaint with the Capital Markets Authority (CMA), issuing a caveat emptor - a legal “buyer beware” notice - over the company’s planned restructuring of MTN Mobile Money.
Represented by Reeve Advocates, shareholders say the transaction raises red flags: from risks to shareholder value and liability exposure to insufficient disclosure of key details.
“Our view is that the transaction has a potential adverse interest on the security interests of shareholders, for which MTN has not provided sufficient comfort,” the notice reads in part.
At the core of their concern is the fear that the spin-off could strip MTN Uganda of one of its most profitable units.
Yet there are insufficient explanations of what shareholders stand to gain or lose, with the major sticking point being lack of transparency around the mobile money unit’s liabilities.
Shareholders argue that MTN has not presented a detailed plan to address existing or contingent liabilities, including those that could emerge during or after the restructuring.
“One would expect a comprehensive report detailing actual, contingent, and potential liabilities - shared with both regulators and shareholders,” the notice reads further, and also flags gaps in information about the new company, its structure, and the identity of Registered Trustees expected to oversee the asset.
Beyond legal and financial risks, the notice accuses MTN of failing on inclusive communication - using technical language and inaccessible formats that may exclude some shareholders.
“We are concerned that the communication approach does not cater to all shareholders. “MTN Uganda is obligated to facilitate full comprehension, regardless of shareholders’ educational background or visual ability,” the notice reads.
Minority shareholders who have spoken to Daily Monitor argue that MTN has a fiduciary duty to act in their best interest, starting with timely and full disclosure before any decision that could materially affect value.
They also argue that detailed disclosures should have come well ahead of any meeting to allow time for debate and informed decision-making.
Shareholders’ dilemma
To gauge shareholder mood, you would also analyze the movement of its stock.
When early signs of the proposed Fintech separation emerged, which were first reported by Daily Monitor in early 2025, MTN’s stock had surged from its IPO price of Shs200 to Shs290 by January.
But the mood has since shifted. As concerns over transparency and minority shareholder protections grow.
By June 30, the stock had retreated to Shs261.06, still above the IPO price, but this erased roughly Shs600m in market value.
Whereas, this could be a small pointer, it tells the mode of some shareholders.
Yet to some, like Kenneth Legesi, the Ortus Africa Capital chief executive officer, the move is strategic, and he believes separating the mobile money unit is essential to unlock its true worth.
“Today, MTN Uganda stock is a bundle - the telecom and Fintech together,” says Legesi. “But once mobile money is carved out, that bundled value disappears. Reclaiming it could take three to five years - until the Trust dissolves and the new FinCo lists.”
By spinning off mobile money, MTN is aligning with the Group’s broader Fintech ambitions - scaling fast, attracting global investors.
MTN, under the 2021 National Payment Systems Act, had already separated mobile money from the telecommunications operations.
But the new ambition seeks to create an entirely separate entity, whose financials are not just a line in the MTN Uganda results.
It will be an entirely different entity under a new reporting line under the Fintech arm.
But without guarantees around listing or revenue-sharing, some shareholders are uncomfortable with the whole arrangement.
Currently, Fintech revenues still flow into MTN Uganda’s books, boosting dividends.
But once separated, will those profits still benefit listed shareholders, or be ring-fenced for institutions?
It’s a structural dilemma
Telecoms are slow, asset-heavy, and regulated like utilities.
Fintechs are fast, asset-light, and tightly regulated on data and cybersecurity.
To compete, they need agility - to partner with global players like Visa or PayPal, and to move at startup speed. Being tied to a listed telecom can stifle this.
This isn’t just MTN’s turning point—it’s a litmus test for Africa’s capital markets.
Can retail investors in frontier markets share fairly in tech growth? Or will they keep holding infrastructure while the upside flies offshore?
