SAFARICOM, VODACOM PLAN $13 MILLION PURCHASE OF M-PESA RIGHTS FROM VODAFONE

NAIROBI (Reuters) - Kenya’s Safaricom will start a joint venture with Vodacom to acquire the intellectual property rights to the popular M-Pesa mobile financial services platform from Britain’s Vodafone, Safaricom’s CEO said on Thursday.

The 12 million euro ($13.4 million) deal will let both purchasers make significant savings in royalties paid to Vodafone and expand the service to new African markets, said Bob Collymore, Safaricom’s CEO.

“We are taking ownership of M-Pesa, the brand and the intellectual property. Joint ownership between us and Vodacom and we then use that as a platform into running into other markets across the continent,” Collymore told Reuters in an interview.

Safaricom, the most profitable company in East Africa, pays 2 percent of its annual M-Pesa revenue to Vodafone. Revenue from M-Pesa stood at 75 billion shillings ($741 million) in Safaricom’s financial year to the end of March.

Vodacom, a South African operator which owns 35 percent of Safaricom, pays 5 percent in an intellectual property fee to Vodafone from its M-Pesa business, which is mainly in Tanzania.

“More important than the significant savings is about us determining the future, the roadmap of M-Pesa because at the moment the roadmap is determined by Vodafone,” Collymore said.

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