Sportpesa’s fate is in the hands of a bad bet

While the multi-billion shilling legal dispute between SportPesa shareholders and a new business, Milestone Games Ltd, continues, the two firms have been removed off the new list of regulated public lottery enterprises.

This would hurt Milestone Games, which acquired certain SportPesa assets – including its trademark – without the consent of the Kenyan shareholders.

The BCLB has only licensed 13 businesses to offer public lotteries as of July 31, according to a letter addressed to Safaricom and Airtel. It contains 76 bookies and 39 casinos.

Former owners of Pevans East Africa, which owns the SportPesa brand, believe that the Bulgarian shareholders did this behind their backs as boardroom disputes increased and the government banned SportPesa over money laundering and tax evasion allegations.

When the BCLB tried to block Milestone from utilizing SportPesa last December, the High Court prevented them from interfering with Milestone’s business and activities until the hearing and decision. Milestone kept the SportPesa name, website, and paybill numbers.

Former SportPesa stockholders demand billions of shillings in court filings. Safaricom and Airtel, which run the SportPesa paybill numbers, are also involved.

In the blazing drama over the ownership of betting billions, Milestone accused Airtel officials of neglecting to unlock the short codes and wanted them punished for contempt of court.

Milestone Games, a new firm with some opaque stockholders, arose when Pevans East Africa lost its gaming licence. After BCLB registered Milestone, it was revealed that SportPesa CEO Ronald Karauri possessed a stake via a sham business.

SportPesa legal battle

Its gaming licence was revoked when the Kenya Revenue Authority requested over Sh92 billion in tax arrears and certain overseas owners were suspected of money laundering and tax cheating.

The Kenyan owners allege they spent over Sh40 billion promoting the brand locally and globally before it became one of Kenya’s key money outflow channels. That was before President Kenyatta ordered security services to clamp down on gaming and money laundering.

Pevans East Africa lost its Kenyan operating permit soon after, and the cash cow ran out. However, because the trademark SportPesa was registered with the World Intellectual Property Organization (WIPO) under Pevans East Africa, it might be transferred to a new business.

First, Pevans executives and lawyers in Nairobi assigned it to SportPesa Global Holdings UK on September 9, 2020. On September 14, 2020, SportPesa Global Holdings Ltd was issued the trademark SportPesa by the Registrar of Trade Marks in Nairobi, with Gordon Dadds Corporate Services as the assignee.

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