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Elaine Wynn demands sweeping top-level change at US casino giant Wynn Resorts as scandal-hit ex-husband retreats from firm

Move to improve corporate governance comes amid probe into how company handled sexual misconduct allegations against former chief Steve Wynn

PUBLISHED : Wednesday, 18 April, 2018, 1:13pm
UPDATED : Wednesday, 18 April, 2018, 2:17pm

US casino giant Wynn Resorts is facing a top-level shake-up after the ex-wife of its scandal-hit former chief executive Steve Wynn demanded sweeping changes in the boardroom to improve corporate governance.

The move by Elaine Wynn comes amid a probe by regulators in the United States into how the company handled sexual misconduct allegations against her ex-husband, who stepped down earlier this year.

Elaine Wynn is now the largest shareholder in Wynn Resorts, the parent company of Wynn Macau, the most lucrative arm of its global gaming business. She is seeking to overhaul the company’s board “with an interest in fully restoring its reputation and in transforming it into a corporate governance leader”.

Elaine Wynn, who controls 9.25 per cent of Wynn Resorts stock, said she wanted to restructure the board with a majority of new members, according to a letter sent on Tuesday and included in a regulatory filing.

All outstanding litigation with her ex-husband was settled earlier this week in a deal which included a US$25 million payment and an agreement that she drop all claims against Wynn Resorts.

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Steve Wynn, until last month the company’s largest shareholder, resigned from the gaming group in February amid allegations of sexual impropriety. Since then, the businessman has sold his entire stake.

In Tuesday’s letter to the board, Elaine Wynn said: “I believe that the company’s governance structure needs to be reformed and that the board of directors needs to be reconstituted.”

She said an upcoming annual meeting would be an opportunity for shareholders to nominate directors and propose other business.

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“I believe that a responsible and independent board would do so, given the profound change in circumstances since the nominating window closed,” she said.

She also called for a majority of the board to be comprised of new directors “effective at the 2018 annual meeting”. That, she said, could be achieved by declassifying the board, meaning each director would stand for election every year, or for the board to vote to increase its size “such that the newly elected directors would constitute a majority”.

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The company’s co-founder said additionally that she intended to put forward her own candidates that “would be independent of the company, Steve Wynn and myself”, adding that she did not intend to nominate herself to the board.