Nigerian fintech startup Moniepoint is in advanced talks to acquire homegrown financial services provider Kopo Kopo in an all-stock deal, according to sources familiar with the matter.
The proposed acquisition, which values Kopo Kopo at over $10 million, could be announced as early as next week if the final negotiations go through successfully.
Moniepoint, which runs a digital banking service, has been on an acquisition spree as it seeks to expand its offerings and user base. The company last year acquired another Kenyan fintech, Pezesha, in a share swap deal.
Acquiring Kopo Kopo would allow Moniepoint to tap into the SME lending space and broaden its reach beyond its core individual customers.
Kopo Kopo, on the other hand, will benefit from Moniepoint’s larger balance sheet and extensive network of agent banking outlets across the country. The fintech has been facing funding challenges lately that have slowed down its growth.
The proposed transaction will need approval from regulators including the Central Bank of Kenya. It will also trigger a share swap for Kopo Kopo’s investors and founders who own substantial stakes in the company.
If successful, the acquisition will mark further consolidation in Kenya’s maturing fintech space where competition has intensified amidst rising funding and regulatory hurdles. A number of startups have turned to mergers and buyouts as an exit or survival strategy.
Moniepoint and Kopo Kopo are among the top funded fintech startups in Kenya, having raised millions of dollars from local and foreign investors.