MGM, Wynn Resorts in board battles as casinos slump

The casino giants, along with peer Las Vegas Sands, have been hurt by a slowdown in Macau — the world's top gambling destination — amid tighter regulation by the Chinese government and slower growth in China's economy. The slump is causing turmoil in the sector.

On Monday, MGM urged shareholders to reject Land & Buildings' bid to put four people on the company's board, as the activist fund pushes to split the company in two.

Land & Buildings has proposed that MGM split into a real estate investment trust and a separate company that would own and control its casinos, saying that would free shareholder value. The casino company would then lease back the land from the REIT.

MGM said in a letter that "doing so could be damaging to the board's unified strength and complementary skills-based construct."

Specifically, MGM charges that an analysis done by Land & Buildings makes unwarranted assumptions, "leading to a questionable value proposition as presented."

Still, MGM doesn't outright reject the idea of forming a REIT.

Shares were down more than 2% in Monday afternoon trading on the stock market today.

Separately, the battle between Elaine Wynn, ex-wife of Wynn Resorts founder and CEO Steve Wynn, and Wynn's board is heating up. The Steve Wynn-backed board has moved to remove her at its April 24 stockholder meeting.

The board got backing Monday from proxy advisory service, Glass Lewis, which said "... we do believe the board is successful in suggesting Ms. Wynn's increasingly distinct interests as a shareholder of the company have potentially impinged upon her ability or willingness to act solely as a fiduciary for independent investors."

Elaine Wynn, the third-largest Wynn shareholder, shot back in rebuttal, "Through the years, my voice has only grown, and I am proud to say we have an outstanding track record of success."

Glass Lewis was the second advisory firm to back Wynn's board in its attempt to oust Elaine Wynn. On April 5, Institutional Shareholder Services in a report said there was "no compelling reason" to retain her on the board. That report was also critical of the current Wynn board, though, saying its performance has been less than stellar.

Shares were down 1.5%.