Pevans East Africa Limited has sued the former chair Paul Ndung’u over claims of fabricating statements and falsehoods.
Ndung'u gave statements on transfer of funds, partnerships and audits, claims which have attracted the suit.
In the plaint seen by The Standard, Pevans says claims by the former chair that the board of directors had frustrated a forensic audit are false. To the contrary, the company says, approvals were made but the same was never conducted.
According to Pevans' lawyers Otieno Ogola and Company Advocates, the firm granted Asenath Maina her wish for audit of the accounts. Maina holds 21 per cent stake in the firm.
Failed to carry out
- READ MORE
- SportPesa: Sport kits that nurture dreams
- Resolve SportPesa dispute for the good of sports in Kenya
- SportPesa and BCLB in clash over licence
- How Chelsea missed chance to regain place in the Premier League top four
- Division One win pleasant surprise for Pandya
- Chanelle, 14, floors rivals to lift Kabete Open title
“The said Mrs Maina has failed to carry out the forensic audit to date despite the board’s approval,” court papers read in part.
Ndung’u owned 17 per cent share in Pevans, making him the fourth largest shareholder. Guerassim Nikolov, a Bulgarian, is said to hold an equal stake with Maina.
The company claims that Ndung’u’s statement released on November 1, ruined its reputation as a sports betting firm, a sponsor of international top football clubs and sporting events.
Pevans argued that the former chair was in a privileged position where he could access information or clarification on dealings. Besides, he sat at the helm of the company when all the issues he raised were dealt with.
The firm further said that on account of the position Ndung'u held, any information he gives can be taken as gospel truth.
“The first defendant (Ndung’u) in uttering the impugned words was acting in abuse of that privileged position he holds, to recklessly defame and malign the name and the image of the plaintiff in the eyes of the public and the plaintiff’s business partners and associates,” court papers read in part.
In a supporting affidavit, Pevans director Robert Macharia rebuffed Ndung'u's claims that the firm sent to South Africa 500,000 dollars. Macharia is also the betting firm’s Company Secretary.
The director explained that overseas payments are done in two parts — payment for software to SportSoft at 2.4 per cent of total stakes and shared services which caters for global sponsorships and any other benefit of the SportPesa brand globally.
Court papers show that the firm has partnered with Racing Point F1 and English football clubs like Arsenal, Everton and Hull City. At the same time, Macharia claimed that no payments were made without the approval of Central Bank of Kenya.
“Whenever the company made overseas payments, the same were subject to control and regulation of the Central Bank of Kenya and receiving countries central bank or equivalent,” his affidavit read.
Macharia argued that Ndung’u was aware of the partnerships and sponsorships and attended some of the events organised by the firm.
The director said the money sent to start SportPesa business in Tanzania was a loan and will be repaid. Macharia also denied that audit firm PricewaterhouseCoopers resigned as Pevans auditors.
This comes as the High Court lifted a freeze order issued in favour of Kenya Revenue Authority (KRA) against Pevans accounts claiming that it owed it Sh14 billion in tax.
Justice David Manjanja found that KRA had given Justice Margaret Muigai a similar narrative and which she declined to continue freezing the firm’s accounts.
“Apart from the fact that all these cases were known to KRA, the present application, the first application and the pending appeals all deal with the same subject matter,” Justice Manjanja ruled on November 13.