Boardroom battle for Wynn
A battle for control of seats on the board of Wynn Resorts appears to be the next front in an escalating dispute between Las Vegas casino magnate Steve Wynn and long-time business partner and Japanese pachinko billionaire Kazuo Okada.
Okada, Wynn Resorts' single biggest shareholder with a 20 per cent stake, is seeking to name up to four directors to the company's 12-member board, in addition to his own board seat, according to a United States regulatory filing posted yesterday. The brewing boardroom battle comes in the wake of a lawsuit Okada filed last week in a Nevada court.
He is seeking access to Wynn Resorts' books regarding a HK$1 billion donation to the University of Macau Development Foundation, which was announced by Hong Kong-listed Wynn Macau last year. He also wants information on other transactions after he said his previous requests to look at the books were 'summarily rebuffed'.
Wynn Resorts called Okada's lawsuit preposterous and said it would defend itself vigorously.
If voted in at an annual shareholders' meeting expected to be held in May, Okada's four board nominees would replace the current company directors who are up for re-election. They include Wynn Resorts chief operating officer Mark Schorr, a 30-year veteran of Steve Wynn's casino businesses, and Linda Chen, the chief operating officer of Wynn Macau, who also oversees group-wide casino marketing to VIP players. Schorr and Chen both also serve as directors of Wynn Macau.
Also up for re-election is John Moran, a retired businessman and former heavyweight Republican Party fund-raiser, and Elaine Wynn, former wife of chairman and chief executive Steve Wynn.
However, in line with a shareholders' agreement between Okada and the Wynns, Elaine may only be replaced by Okada's nominee if she declines to stand for re-election. Steve Wynn divided his 20 per cent stake in the company equally with Elaine last January following their divorce.
The same shareholders' agreement stipulates that the majority of the board, or seven seats, must at all times be candidates endorsed by Steve Wynn, while he must also endorse any minority roster of directors proposed by Okada.
Okada's Universal Entertainment declined to identify its proposed four directors, but said all of them are independent from Okada and the businesses he controls.
In the suit, Okada objects to the HK$1 billion Macau donation, to be paid out in annual installments to 2022 - the year Wynn Macau's gaming licence expires. It also seeks access to financial records regarding a US$120 million investment he made in the company in 2002 to help fund development of the Wynn Macau casino resort.
Wynn Resorts said last week that Okada was removed as vice-chairman in October.
It characterised his legal action as one intended 'to deflect attention from a dispute between Mr Okada and the board ... related to Mr Okada's decision to directly compete with the company by pursuing a project in the Philippines despite repeated admonishments from the board'.
Universal Entertainment in 2008 won a preliminary licence to develop a casino resort in Manila.
The increase in casino gambling revenue for Macau last year. Revenue was US$33.5 billion, up from US$23.5 billion in 2010