Funding: KPL, FKF, Boxing Association, as well as Rugby Union set to lose Sh600m annually

AFC Leopards Gilbert Fiamenyo(R) and Harun Shakava of Gor Mahia hang for header during their Sportpesa Premier League match at Nyayo National Stadium on Sunday 07/05/17.PHOTO.BONIFACE OKENDO

Huge blow as Sportpesa cancels sports funding

Gor Mahia and AFC Leopards to pull out of continental matches after withdrawal of betting firm.

Leading betting company SportPesa has announced that it will immediately withdraw all sports sponsorship in the wake of a decision by the Government to increase tax to 35 per cent.

This means that Sh600 million will be lost every year as sponsorship funding.

After the announcement, local giants AFC Leopards and Gor Mahia said they would pull out of this year’s continental tournaments.

Until yesterday, the two clubs were enjoying a combined Sh100m shirt sponsorship a year from SportPesa.

The SportPesa chief executive officer, Ronald Karauri, officially announced the withdrawal of all sponsorship yesterday after the firm last week lost a case in which it challenged the implementation of the tax that came into effect from Monday.

“Unfortunately, we lost the case. We regret this decision and we have no choice, but to cancel all sponsorships we have as SportPesa,” Karauri said.

The CEO dispelled fears that the company would move from Kenya, insisting that it was here to stay. However, he said it might have to restructure.

He welcomed the government proposal of establishing a sports lottery to fund federations, teams, and individual athletes but said it would not be enough to cater for the industry’s needs.

“The lottery has changed sports in the UK, but at the end of the day, if you do not have a private sector to support it, it cannot work. The private sector and the Government have a role to play and we need to come together.”

Karauri said he was willing to meet with President Uhuru Kenyatta to initiate dialogue on the matter, adding that SportPesa would make a swift return to sports if an amicable solution was found.

The SportPesa boss also said the company would lodge an appeal.

The Gor chairman, Ambrose Rachier, said his team would write to the continental body, CAF, stating their withdrawal from the 2018 Champions League as they could not afford to sustain their participation in the continental tournament.

“One-way air tickets alone cost Sh3.5 million. The total cost for one round is about Sh10 million. It is simply impossible to sustain this and we have no choice but to pull out.

“Our gate collections are not enough to cater for the expenses and also pay players and the technical bench. This leaves us in a dilemma,” he said.

His Leopards counterpart, Dan Mule, said his team would follow suit and withdraw from the 2018 CAF Confederations Cup.

“We have no sponsors right now. We are going to withdraw from CAF assignments. We are urging other like-minded corporates to emulate SportPesa and support community clubs.

“I don’t know how we will pay the 10 international players we have signed ahead of the season,” Mule said.

Other organisations affected by the withdrawal include Football Kenya Federation (FKF), Kenya Rugby Union, and the Boxing Association of Kenya.

The Kenyan Premier League will also be affected as SportPesa was its official title sponsors. Others to be affected are the SportsPesa grassroots tournament, Nakuru All Stars, as well as Kenya Harlequin rugby team.

The World Boxing Council women’s super-bantamweight champion, Fatuma Zarika, and local rally driver, Leonardo Varese, are also affected.

FKF will have to get money to pay national team coach Paul Put and technical director Andreas Spiers, who were both paid by the betting firm.