MTN Uganda has announced a 14-day exit window for minority retail shareholders ahead of the planned separation of its Mobile Money business. This move is part of the company’s broader restructuring under MTN Group’s “Ambition 2025” strategy, which aims to transform MTN into a digital-first business by accelerating growth in financial technology across Africa.
Under the restructuring plan, MTN’s mobile money arm — MTN Mobile Money (U) Ltd (MTN MoMo) — will be merged into a newly created fintech company, MTN New FinCo, which will become the surviving entity. This company will be jointly owned by MTN Group Fintech Holdings B.V. and a specially created trust. The trust will represent both retail and institutional shareholders of MTN Uganda, ensuring that their voting rights and economic benefits remain intact even after the spin-off.
The new fintech entity will operate independently from MTN’s telecom services and will be regulated under Uganda’s National Payment Systems Act.
To address shareholder concerns about the new structure, MTN Uganda will offer a voluntary exit option. Once all regulatory approvals are secured, a 14-day window will open during which shareholders who are uncomfortable with the new arrangement can sell their shares through licensed brokers. MTN has also committed to buy back any unsold shares, aiming to ensure a smooth transition and prevent sudden price volatility or panic selling.
To ease concerns about the increase in withholding tax on dividends (from 10% to 15% for Ugandan tax residents), MTN will introduce a dividend adjustment trust. This mechanism will absorb the tax difference, protecting retail investors who rely on dividends as a key source of income.
The Extraordinary General Meeting (EGM) to approve the restructuring was initially scheduled for July 2, but has now been postponed to July 22, 2025, giving shareholders more time to study the proposal. The meeting will be held in a hybrid format (physical and virtual) to encourage broader participation across Uganda and the diaspora.
Despite MTN’s reassurances, some shareholders remain wary. A group of investors has filed a formal “caveat emptor” notice with the Capital Markets Authority, calling for more transparency around the trust — including who will act as trustees, how governance will be handled, and whether there are any hidden liabilities.
There are also concerns that the new structure could increase MTN Group’s control at the expense of local shareholders, and that the highly profitable fintech unit may become less accessible to retail investors in the future.
In response, MTN Uganda has reiterated that no shareholder will lose their rights or benefits. The company has committed to regular updates throughout the regulatory process and emphasized that the trust structure is designed to protect investor interests.
MTN MoMo is one of the largest mobile money platforms in Uganda, offering services like money transfers, savings, merchant payments, loans, and bill payments. By spinning it off, MTN aims to unlock new investment opportunities, attract fintech partners, and position the business for independent growth — including a future listing on the Uganda Securities Exchange.
This move mirrors similar steps taken by other telecom giants, such as Airtel Africa, which also separated its mobile money arm to attract strategic investors and streamline operations.
