In April 2020, Visa Inc (listed on the New York Stock Exchange) acquired 19.95% of Interswitch Holdings Limited, a Nigerian payments firm for a cash consideration of $200 million. This valued the company at just over $1 billion.
For full Year period that ended March 2020, Interswitch reported revenues of N33.49 billion equivalent to $93m as the average exchange rate in 2019 was 360.0594 NGN per dollar.
Visa basically bought Interswitch shares at a Price to Sales P/S valuation of 10.75x.
By Full Year 2023, Interswitch Holdings Limited had grown its consolidated revenue to N66.5 billion. However, the Nigerian Naira has been devalued to 1,500 NGN per dollar meaning those revenues are now worth about $44.3 million.
Applying the P/S Visa acquisition valuation would value Interswitch today at $476 million, according to MoneyCentral calculations.
Visa’s $200 million stake would then be now worth only about $95.2 million due to the devaluation.
It is important to note that Nigeria represents 94% of Interswitch Holdings Limited’s Group’s revenue. It also means Interswitch, Africa’s veteran fintech company has lost its unicorn title.
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