U.S.-based casino operator Wynn Resorts Ltd announced on Wednesday that it had accepted the resignation of Steve Wynn (pictured) as chief executive and chairman of the firm’s board of directors.
The board has appointed Matt Maddox, currently president of the company, as its CEO, and Boone Wayson as non-executive chairman of the board of directors, effective immediately, the company said in a press release.
The company said details of Mr Wynn’s separation agreement will be disclosed once finalised.
“It is with a collective heavy heart, that the board of directors of Wynn Resorts today accepted the resignation of our founder, CEO and friend Steve Wynn,” said Mr Wayson in a statement included in the press release.
He added: “Steve Wynn is an industry giant … He played the pivotal role in transforming Las Vegas into the entertainment destination it is today. He also assembled a world-class team of executives that will continue to meet the high standards of excellence that Steve Wynn created and the Wynn brand has come to represent.”
The announcement of Mr Wynn’s resignation was made amid a broader controversy surrounding the executive, as the Wynn Resorts’ board awaits the results of an investigation into allegations of sexual misconduct made by former Wynn Resorts employees against Mr Wynn. Wynn Resorts has formed a special committee consisting solely of independent directors to investigate the claims.
Those allegations were contained in a Wall Street Journal article published a fortnight ago. Mr Wynn has denied the allegations.
Explaining the decision to resign, Mr Wynn said in a prepared statement: “In the last couple of weeks, I have found myself the focus of an avalanche of negative publicity. As I have reflected upon the environment this has created – one in which a rush to judgment takes precedence over everything else, including the facts – I have reached the conclusion I cannot continue to be effective in my current roles”.
He added: “The succession plan laid out by the board of directors and which I wholeheartedly endorse now places Matt Maddox in the CEO seat. With Matt, Wynn Resorts is in good hands. He and his team are well positioned to carry on the plans and vision for the company I created.”
The publication of the sexual misconduct allegations has led the Massachusetts Gaming Commission to open an investigation into Wynn Resorts. The company is currently developing a casino property in Boston, Massachusetts. The US$2.4-billion project is scheduled to open in 2019.
The Massachusetts Gaming Commission’s decision follows a similar move by the Nevada Gaming Control Board. The Nevada regulator announced last week it would launch a formal investigation into the allegations of sexual misconduct made against Mr Wynn.
Wynn Resorts – with gaming operations in Las Vegas, Nevada – is the parent company of Macau-based casino operator Wynn Macau Ltd.
Wynn Macau Ltd also announced on Wednesday that Mr Wynn has resigned as chairman and CEO of company with immediate effect. He also stepped down as director and officer of the company’s subsidiaries, including of Wynn Resorts (Macau) SA, the local unit that holds the Wynn group’s Macau gaming concession.
The Hong Kong-listed company said that Mr Maddox has been appointed as the new CEO, while Allan Zeman has been named non-executive chairman.
Wynn Macau Ltd said additionally that – subject to the completion of certain Macau regulatory procedures – Mr Maddox will become chairman of Wynn Resorts (Macau), while Wynn Macau Ltd president Ian Coughlan will become a director in the subsidiary.
Linda Chen, Wynn Macau Ltd’s chief operating officer, will remain as president of Wynn Resorts (Macau), the company added.
The Wynn brand
In Wednesday’s release, Wynn Resorts said it remains “as committed as ever to upholding the highest standards and being an inclusive and supportive employer”.
“The company will continue to fully focus on its operations at Wynn Macau, Wynn Palace and Wynn Las Vegas; the development and opening of the first phase of Wynn Paradise Park, currently under construction on the former Wynn golf course; as well as the construction of Wynn Boston Harbor, which will open in June 2019,” it added.
Analysts at brokerage Deutsche Bank Securities Inc said in a note last month that they believed that there would be a negative impact on Wynn Resorts if Mr Wynn were to step down.
“Mr Wynn’s influence, most notably in the development and design phases of the iconic buildings, and the way they are managed and maintained, directly impacts the majority of [a company’s] valuation considerations,” said analysts Carlo Santarelli and Danny Valoy.
“Accordingly, we believe his influence on operations, the brand, and the investment community, is more pronounced than that of the majority of his peers,” they stated.
The Deutsche Bank team added: “If Mr Wynn were to step down … we do believe there would be an impact, over time, on the operations of the company and we believe the design and development of future company projects would lack the meticulous attention to detail the current portfolio is renowned for.”
The recent controversy surrounding Mr Wynn also led Standard & Poor’s Global Ratings to revise last week its outlook on Wynn Resorts and its subsidiaries – including its Macau unit – to “negative” from “stable”. The ratings agency said the negative outlook reflects the “significant uncertainty” over the resolution of various investigations into the sexual misconduct allegations.
(Updated at 4.57pm, Feb 7)
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"With the mainlanders and Hong Kongers now effectively barred from entering Macau, the only rationale possible for keeping the casinos in Macau open right now is a social one which is to keep Macau residents employed"
Managing partner of IGamiX Management and Consulting Ltd