Elaine Wynn, the largest single shareholder of casino group Wynn Resorts Ltd and former wife of the ousted founder and chairman Steve Wynn, said on Wednesday that she was suing the firm in Nevada state court in a bid to delay a shareholder meeting. Ms Wynn alleges she was being prevented from communicating directly with the group’s shareholders in her campaign to revamp the board.
Ms Wynn’s complaint – outlined in an open letter to shareholders and carrying Wednesday’s date – claimed Wynn Resorts had been “actively using” information on certain shareholders – known in corporate management jargon as “non-objecting beneficial owners” – in order to “communicate directly with Wynn Resorts’ shareholders; something Ms Wynn is unable to do, even though she is the company’s largest shareholder”.
The company – the parent of Macau casino operator Wynn Macau Ltd – issued a statement carried by investor website Seeking Alpha that appeared to make some concessions to Ms Wynn.
It said: “Elaine Wynn once again has chosen to litigate rather than communicate, despite the company’s public offers to meet with her to discuss the current state of the business. This time, she has asked a court to delay the Wynn Resorts annual meeting, which has long been scheduled for May 16.”
The casino company added: “We believe a delay is unwarranted and not in the best interests of shareholders. She is also demanding we provide additional materials that go far beyond what is required under Nevada law. As a sign of our good faith, the company will provide her with the shareholder… lists she now seeks.”
Ms Wynn has repeatedly claimed that the board remains in totality too close to Mr Wynn. In late April Ms Wynn had urged the firm’s shareholders to block the re-election of current board member John J. Hagenbuch. A week prior to that call, the firm had rejected a request by Ms Wynn to reopen the window in which shareholders can nominate directors.
Mr Hagenbuch – who has served as a director since 2012 – is up for re-election at the May 16 annual general meeting. He is a member of a special committee set up by the firm to probe allegations of sexual misconduct against former chairman and chief executive Mr Wynn. The latter has denied the claims, but resigned from the group in February and has since sold his entire stake in the firm.
Wynn Resorts issued a Wednesday filing that did not directly address Ms Wynn’s litigation regarding disclosure of shareholder information for lobbying purposes. But the firm did state to shareholders: “Withholding your vote for Jay Hagenbuch will not benefit your investment.”
The company further noted: “Jay brings to our board deep corporate strategy and financial expertise gained over 30 years as a private equity investor and as a director of public and private companies.”
It added: “ In a complex and heavily regulated industry, Jay has the experience to effectively identify and manage Wynn’s risk exposures and attendant vulnerabilities. As chairman of the audit committee, he is intimately familiar with Wynn’s operations, strengths and weaknesses, and its specialised regulatory framework.”
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Kwok Chi Chung
President of junket trade body, the Macau Association of Gaming and Entertainment Promoters