Companies

Safaricom hires Citi Bank MD in acquisitions and mergers chase

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Mr Michael Mutiga. FILE PHOTO | NMG

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Summary

  • Safaricom has hired the managing director of Citi Bank to be in charge of strategy and acquisitions, underlining the telco’s quest to get a larger share of the financial services market.
  • Mr Mutiga replaces former Safaricom’s long-serving chief of special projects and acting chief business development and strategy officer Joe Ogutu who retired from the company last month.

Safaricom #ticker:SCOM has hired the managing director of Citi Bank to be in charge of strategy and acquisitions, underlining the telco’s quest to get a larger share of the financial services market.

Mr Michael Mutiga who is Citi’s managing director and head of corporate finance for sub-Saharan Africa from 2019 will be the new chief business development and strategy officer according to an internal memo seen by Business Daily.

The appointment comes at a time the telco is seeking regulatory approvals to launch insurance, unit trust and saving products as it races for a larger piece of the financial services market and taps more earnings from mobile money platform M-Pesa.

Mr Mutiga replaces former Safaricom’s long-serving chief of special projects and acting chief business development and strategy officer Joe Ogutu who retired from the company last month.

A former Barclays executive,  Mr Mutiga has been with Citibank for 15 years, serving in various senior local and regional management roles.

The shift in the corner office comes at a time Safaricom’s mobile money platform M-Pesa has overtaken voice to become the biggest revenue earner for Safaricom, underlining the growth of the financial service that was launched in 2007.

“He will lead Safaricom’s business development and transformation agenda, and will be responsible for strategic partnerships, mergers, and acquisitions; Safaricom’s funding strategy and asset optimisation,” said Safaricom chief executive Peter Ndegwa.

The telco is seeking to enter new ventures as voice declines. Safaricom forecasts M-Pesa will account for half of its sales in coming years as revenues from voice and SMS flatten.

The service overtook voice last year to become the single largest business line after it posted the highest revenue growth of 45.8 percent to Sh52.3 billion.

Safaricom's growth strategy hinges on widening M-Pesa offerings and bolstering its data business to offset a fall in revenue from mobile calls amid a saturated market.

The Nairobi Securities Exchange-listed firm wants to use new products as part of the strategy to broaden M-Pesa into a financial service provider that will rival banks, insurance firms and fund managers.

The telco has been testing three new products dubbed Bima (Insurance), Mali (mobile savings) and a unit trust investment product.