African tech goes world with US acquistion
In a uncommon and thrilling acquisition of a US tech firm by an Africa-based agency, digital funds community MFS Africa introduced in June that it’ll purchase Oklahoma-based World Know-how Companions (GTP), a processor of pay as you go playing cards which works with over 80 banks in 34 African international locations.
MFS says the acquisition will increase its potential to supply fee playing cards that can hook up with buyer cellular cash accounts, permitting African customers to transact extra simply with world retailers, corresponding to massive worldwide e-commerce manufacturers. The agency additionally says the deal will permit it to win offers with massive American retailers and purchase gifted US staff in service provider processing and different areas.
Transatlantic partnerships between Silicon Valley and Africa’s tech scene are nothing new. In 2020, Irish-American on-line funds big Stripe purchased Nigerian funds startup Paystack in a deal price round $200m. However the site visitors has largely been one-way thus far, as African fintechs flock to Silicon Valley to faucet its huge group of buyers.
The continent’s startups attracted investments totalling about $5bn from across the globe final 12 months, in response to the African Non-public Fairness and Enterprise Capital Affiliation.
African corporations on the hunt
However the MFS-GTP deal is an indication that Africa’s maturing startups, removed from being merely targets to be swallowed by worldwide rivals, are themselves available in the market for acquisitions wherever they will discover them.
MFS started working with GTP when the 2 corporations labored collectively on tasks with US playing cards big Visa. Discussions round an MFS funding into GTP quickly gave strategy to a full takeover. The agency already had expertise of acquisitions in African markets. In 2021, MFS Africa acquired Baxi, a Nigerian SME-focused digital fee community.
Its bid to scale up has caught the creativeness of buyers – shortly after the GTP deal, the agency introduced that it had raised an additional $100m in an fairness and debt funding spherical led by Admaius Capital Companions, taking the overall quantity raised within the Collection C to $200m.
The brand new funding will additional speed up its African enlargement plans, in addition to its enlargement into Asia by way of a three way partnership with LUN Companions to allow cross-border digital funds between Africa and China.
Sceptics could say that Oklahoma-based GTP is a rarity in that it’s a US-based enterprise with a precept deal with Africa. However as more cash pours into Africa’s fintech area, anticipate to see African corporations searching ever farther from house seeking thrilling acquisitions.