Punters may have to wait longer to place their stakes in betting firm SportPesa following the suspension of services pending a trademark row. SportPesa announced a comeback to the Kenyan betting scene on Friday 30 October through social media.
In a twitter post, SportPesa CEO Ronald Karauri revealed that the firm had entered into a deal with Milestone Games Limited for the latter to use SportPesa brand name in Kenya.
However, on Saturday October 31 the Betting Control and Licensing Board (BCLB) came out and suspended the firm’s license. The regulator says that it approved Milestone Games Limited to operate using the brand name Milestone Bet. Therefore, Milestone breached the law and failed to get consent from BCLB when rebranding to SportPesa.
Milestone says that it got the rights to use the SportPesa brand from SportPesa Global Holding Limited (SGHL). However, BCLB says that Pevans East Africa Limited owns the SportPesa brand in Kenya. Pevans had filed a petition in the Court of Appeal in Nairobi seeking to overturn BCLB’s license revocation arising from a tax arrears dispute with KRA and have the SportPesa license renewed.
Therefore, BCLB prohibited Milestone from using the trademark SportPesa, the domain www.ke.sportpesa.com, www.sportpesa.co.ke, short codes 29050 and 79079, paybill numbers 521521, 9555700, and 955700 until determination of the court of Appeal case.
INTERNAL WRANGLES
There are also internal boardroom wrangles between SportPesa shareholders on who owns the rights to the Kenyan brand. The wrangles pit the local shareholders against the non-Kenyan shareholders in Pevans that up to June 2019 had 53 percent Kenyan shareholding.
Paul Ndung’u and Asenath Maina, controlling a combined 38 percent stake in Pevans, say that they were kept in the dark about the Milestone deal. In addition, Ndung’u says that they have never been informed of any impeding resumption of SportPesa business in Kenya.
He adds that the CEO and the non-Kenyan shareholders and Executive Directors allied themselves with the CEO and made suspicious transactions. For instance, Ndung’u accuses the group of fraudulently transferring the shareholding of SportPesa Global Holdings Limited to themselves. SPHL is the holding company that owns the trading licenses and businesses of SportPesa Tanzania, SportPesa UK, SportPesa Italy, and SportPesa Russia.
He says that shareholders learnt on Friday the claim that the SportPesa brand belongs to SGHL. However, Ndung’u refutes this by saying that the SportPesa brand started trading long before SGHL formation.
Ndung’u cites a forensic audit of the books that showed that within three years Pevans East Africa Ltd (SportPesa) has transferred over Ksh27.1 billion to various offshore accounts in Isle of Man, Dubai and Las Palmas/Canary Islands and the UK. He says that shareholders learnt that subsequent to ceasing operations, Ksh54.3 million has been transferred from Pevans to SportPesa South Africa while within the two years Ksh1.9 billion has been transferred to SportPesa Tanzania.
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