Details have surfaced of SportPesa CEO Ronald Karauri’s stake in the company behind the betting firm’s short-lived come-back into the Kenyan market, Milestone Games Limited.
An attempt by Milestone Games Limited to use the SportPesa brand in Kenya exposed a fall-out between local and foreign shareholders in Pevans East Africa, which owned its operations in Kenya, and Sportpesa Global Holdings Limited (SGHL). Local shareholders claimed not to be aware of the deal and accused Karauri of aligning himself with foreign shareholders to lock them out.
According to records at the Registrar of Companies, Karauri acquired a 54.4% stake in the company. He was joined in the firm by Francis Waweru Kiarie, who acquired a 40.9% stake in Milestone.
The acquisitions were made through investment vehicles Selenium Limited and NOB Five Limited. Karauri is listed as a director and shareholder of Selenium.
The Sportpesa CEO holds a 57.1 percent stake in Selenium Limited, which has a 96% share of NOB Five, which holds 99.5 percent equity in Milestone.
Kiarie has a 42.8 percent stake in Selenium Limited, explaining his 40.9% stake in Milestone.
Other than NOB Five, the only other direct shareholder in Milestone Gaming is little-known Wilson Ngatia Karungaru, who has a 0.5 percent stake.
It emerged that Milestone Gaming was previously owned 50% by James Muigai Ngengi, a nephew of President Uhuru Kenyatta. Details of how Karauri took control of the company remain scanty.
Peter Kihanya Muiruri, a cousin of the President, holds a one per cent stake in Pevans and a 0.5 per cent equity in SGHL.
The Betting Control and Licensing Board (BCLB) had initially approved Milestone’s application to use the Sportpesa brand in Kenya, after Milestone confirmed that they had approval from Sportpesa Global Holdings Limited.
The decision was, however, revoked and Milestone stopped from using the Sportpesa brand, domains and all associated mobile money paybill accounts. BCLB stated that the brand belonged to Pevans East Africa, citing a pending court case.
Paul Wanderi Ndung’u, who owns 17 per cent stake in Pevans EA and 2.8 percent stake in SGHL earlier issued a statement poking holes into the deal. Foreign investors hold a 47 per cent stake in Pevans and 80 per cent of SGHL.
“That just like the rest of the Kenyan public, I came to learn of the resumption of SportPesa business through the social media at 9 p.m. on Friday,” he maintained.
He further claimed that local shareholders had been locked out of SGHL in the past year.
“SportPesa Global Holdings was a mirror of Pevans EA Limited. However, within this year the foreign shareholders have fraudulently transferred the shareholding to themselves along with their associates and the matter will be handled by UK Authorities,”
Ndung’u also sought answers over $250 million (Sh27.1 billion) allegedly transferred from Pevans to various offshore accounts in Isle of Man, Dubai and Las Palmas/Canary Islands.