Ndung’u Seeks Compensation After UK Judge Finds SportPesa Breached Pre-emption Rights

Investor to Appeal UK Court Ruling on SportPesa Share Dilution

Kenyan investor Paul Ndung’u will appeal a High Court of Justice ruling in London and seek compensation after a judge found that SportPesa Global Holdings Limited illegally diluted his shareholding from 17 percent to 0.85 percent.

Justice Edward Johnson delivered judgment on November 18, 2025, in a case that exposed what the judge described as a pattern of lies, fraud and perjury involving the betting company’s Bulgarian directors and their associates.

The three-week trial at the Business and Property Courts of England and Wales heard how Ndung’u, who served as chairman and director of SportPesa Global Holdings Limited until January 7, 2021, never received offer letters for a rights issue.

The letters arrived only after the subscription deadline had passed.

Justice Johnson agreed that the company breached sections 561 and 562 of the UK Companies Act 2006 relating to pre-emption rights, which protect existing shareholders from unfair dilution.

The company admitted to a second breach during the proceedings.

Despite finding these serious violations of company law, the judge dismissed Ndung’u’s claim on grounds that he could not have afforded the £170,000 needed to take up the shares.

This finding directly contradicted bank evidence showing Ndung’u had access to over £896,000 through personal accounts, business accounts and overdraft facilities.

The investor had a standing overdraft of Sh50 million, approximately £416,000, and Sh60 million in his personal account.

His business account held over Sh100 million.

By early 2023, Ndung’u had already spent more than £300,000 pursuing the case and committed in writing to invest up to £500,000.

Dr Ekuru Aukot, who represented Ndung’u, said the judgment contains contradictions that will form the basis of the appeal.

The court granted Ndung’u until January 28, 2026, to lodge his appeal papers.

The case also revealed that SportPesa Global Holdings Limited violated UK accounting requirements by failing to prepare audited consolidated accounts.

The court found that the company did not qualify for the small companies exemption because its balance sheet exceeded statutory limits and the group employed more than 50 people.

Ndung’u had appointed KPMG as auditors, but the two Bulgarian directors, Ivalyo Petev Bozoukov and Kalina Lyubomirova Karazhova, failed to cause an audit.

They claimed KPMG was too expensive and difficult to work with.

The directors also testified that KPMG advised them to prepare accounts under the small company regime, which does not require audits.

Justice Johnson found no written record of such advice and no record of any board meeting discussing the matter.

The judge concluded in paragraph 677 of his judgment that the directors had lied under oath.

The trial heard allegations that the dilution was part of a conspiracy between the Bulgarian directors and other defendants, including Gene Grand, Nikolov Guerassim Nikolov and Naogen Investment Inc. Ndung’u told the court that offer letters were deliberately sent to wrong addresses and email accounts, and that he was never called to inform him of the offer as other shareholders were.

Justice Johnson acknowledged that some forgery allegations were beyond the scope of the case, stating in paragraph 313 that there was no means of investigating certain claims because they fell outside the proceedings.

The UK case followed earlier litigation in Kenya, where the Court of Appeal overturned its own ruling of February 12, 2023, after discovering it had been misled by a forged court order.

In a judgment delivered on April 11, 2025, just weeks before the UK trial began, the Kenyan appellate court cited the intricacies of fraud and forgery.

The discovery prompted the Kenyan judiciary to issue a public notice warning about criminal activity involving the forgery and misuse of court documents.

The Court of Appeal ordered that Ndung’u be included in all matters relating to Pevans East Africa Limited, the Kenyan registered company that contributed 98 percent of the SportPesa Global Holdings group revenue.

During cross-examination in London, the defendants admitted to more than 20 breaches of statutory obligations, claiming their actions were inadvertent and caused unknowingly.

They attempted to frame the dispute as foreign investors against Kenyan investors, characterizing Ndung’u and fellow non-executive directors Asenath Wacera and Kinuthia as trying to push out the Bulgarians.

However, evidence showed the conflict centered on how the executive directors passed resolutions and spent money without full board approval.

Justice Johnson noted that cases involving deliberate shareholder dilution through breach of pre-emption rights under sections 561, 562 and 563 have no precedent in UK courts.

The judge described the case as containing convoluted facts, outright lies, fraud and perjury that the court found strange and mysterious.

Dr Aukot said the complexity of the claim and the unraveling of lies, fraud, forgeries and statutory breaches will likely become a case study in Western universities, law societies and parliaments on how ordinary investors can face miscarriage of justice when pitted against those with access to proceeds of money laundering and tax evasion.

The appeal will challenge the central contradiction in the judgment: how a court can find serious breaches of company law yet dismiss a claim based on an assessment of affordability that contradicts documented evidence of substantial financial resources.