On Friday, 31st October, famous betting platform SportPesa announced its return to Kenya after a 15-month hiatus. SportPesa was originally barred from operating in Kenya over a tax row.
Investors of the betting company have now fallen out over allegations of transfer of Ksh 29.1 billion from the company’s coffers to overseas accounts and sale of shares in the firm’s holding company.
When it was initially operating in Kenya, SportPesa was under Pevans East Africa and not Milestone.
Businessman Paul Wanderi Ndung’u and Asenath Wacera Maina, who have a combined stake of 38%, reckon they were not informed of the Milestone deal, which was made public by SportPesa CEO Ronald Karauri on Friday.
Mr Ndung’u reckons that local top shareholders of Pevans East Africa, the entity behind SportPesa in Kenya, were excluded from buying shares in the holding company — SportPesa Global Holding Limited (SGHL) — leading to dilution of their ownership in the UK-based firm.
SportPesa Global owns the European and Tanzania gaming businesses and recently claimed to also own the SportPesa brand, sparking protests from local shareholders led by Mr Ndung’u who claims that Pevans East Africa owns that betting platform and trade name.
The deal with Milestone was arranged on the strength that the brand belonged to SGHL and not Pevans East Africa, which was last year blocked from operating in the Kenyan market seemingly due to a tax row.
The local shareholders claim that the deal with Milestone could hurt Pevans East Africa leaving it a shell.
In a statement issued on Sunday, Mr Ndung’u accused Mr Karauri of having allied himself with the firm’s foreign investors to run the sports betting platform without consulting the board, notably local shareholders.
“After persistent push, the management report indicated that within three years Pevans has transferred over $250 million (Sh27.1 billion) to various offshore accounts in Isle of Man, Dubai and Las Palmas/Canary Islands,” Mr Ndung’u said.
“Shareholders have also come to learn that subsequent to ceasing operations, $500,000 (Sh54.3 million) has been transferred from Pevans to SportPesa South Africa while another $17.5 million (Sh1.9 billion) has been transferred to SportPesa Tanzania. We want to know who the beneficiaries of these accounts are.”
SportPesa has been trying to get back into the Kenyan market for over a year with no success. They finally came back but only for a day before the regulator barred them again.
The betting company will now have to sort its internal fracas before returning to the Kenyan market.
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