Investing In Africa: Ascent Capital Buys Stake In Ugandan Mobile Money Firm

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Written by Kevin Mwanza

Private equity firm Ascent Capital has invested undisclosed amount in a family-owned Ugandan mobile money firm, Chims Africa, that operates 130 MTN Mobile Money agencies, Business Daily reported.

Ascent Capital, which also have investment in Kenya and Ethiopia, has been on investment spree across East Africa this year and is looking to seal  between eight and twelve deals worth $1 million to $9 million across the region.

The PE firm raised $50 million in February this year from regional commercial investors such as Kenya Power’s pension fund, CNBC Africa reported.

Its latest investment in Chims Africa is expected to help the PE firm enter the ground floor of a fast growing mobile money business in Uganda, where mobile money transfers have more than doubled in the last two years to $6.7 billion in 2014 from $3.2 billion in 2012.

There were about 19 million registered mobile money users in the land-locked East African nation of 40 million people. The World Bank estimates that about 35 percent of Ugandan adults have mobile money account.

Ascent investment in Chims Africa is expected to help the mobile money firm scale up its business and open 700 more mobile money agents in Uganda’s rural areas.

“This investment will allow Chims to ensure availability of its service to customers at all times in this rapidly evolving market,” Richard Mugera, Ascent Capital country director for Uganda, told Business Daily.

Chims is a family-owned MTN Mobile Money franchise established by Norman and Fiona Mutekanga in 2005. It currently has more than 190 employees and serves about seven million customers annually.