Two days before the company's annual meeting

Elaine Wynn managed to remove director from company's Board

Elaine Wynn lost her seat on the Wynn Resorts board in 2015 after the board declined to nominate her and shareholders didn’t support her campaign to be reinstated.
2018-05-15
Reading time 2:37 min
The former wife of Steve Wynn and co-founder of Wynn Resorts finally succeeded in her attempt to boot the director she had urged shareholders to vote against and described as a crony of her ex-husband.

Wynn Resorts issued an unexpected statement just two days before its annual meeting, announcing the resignation of two directors, including John Hagenbuch the one that Elaine Wynn had previously urged shareholders to vote against, and had described as a crony of her ex-husband.

John Hagenbuch, a real estate investor from Ketchum, Idaho, decided that he would no longer stand for re-election at the annual meeting scheduled for Wednesday. Robert Miller, a former Nevada governor, also tendered his resignation.

The company is trying to bounce back from a sexual-harassment scandal involving former Chief Executive Officer Steve Wynn, who is Elaine’s ex-husband, and board changes have been touted by the company as a sign of progress. Wynn Resorts noted on Monday that the two departures, combined with others announced earlier, mean that 60 percent of the Wynn Resorts board has changed since February.

Steve Wynn resigned in February following allegations of sexual harassment that went on for decades. Since then, Elaine Wynn has put pressure on the company to make more sweeping changes. In opposing Hagenbuch’s re-election, she said he was a longtime friend of her ex-husband and faced conflicts of interest. The director served on a special committee investigating claims against the former CEO.

"Over the past three months, the Board has done a remarkable job maintaining stability at Wynn and managing through a tumultuous time that could easily have caused much deeper disruption to the Company's business. There is still more work to be done, and I do not want my candidacy to detract from the important progress we have made throughout the organization, including the ongoing refreshment process this Board has initiated. Wynn Resorts is a strong company, poised for long-term growth and superior shareholder value creation, and I am proud to have served on its Board," Hagenbuch said in the official statement. 

"We respect Jay's decision to withdraw his candidacy for re-election to the Board, and we are immensely grateful for his many contributions to the Company over the course of his 5½ years of service," said D. Boone Wayson, Non-Executive Chairman of Wynn's Board of Directors. "Jay has helped drive change and long-term value creation at Wynn, and his decision to remove himself from the Company's ballot to end the distraction of the withhold campaign is a reflection of his loyalty to Wynn Resorts and his commitment to the success of this Company."

Steve Wynn, who sold all his stock in the company but only after the date of record for the annual meeting, chose not to vote his shares. Elaine Wynn, now the company’s largest individual stockholder, won support for Hagenbuch’s ouster from all three of the big proxy advisory firms, making it very unlikely the director would have won.

Wynn Resorts argued before casino regulators -- and to shareholders -- that the company has cleaned house. It has appointed three new female directors to the board and settled long-running litigation with Elaine Wynn and Universal Entertainment Corp., an early investor. Wynn Resorts, which owns luxury casinos in Las Vegas and Macau, even took the founder’s name off a $2.5 billion resort that it’s building in Massachusetts.

Still, outsiders, such as the shareholder advisory firm Egan-Jones Proxy Services, agreed with Elaine Wynn, Bloomberg reports.

A vote against Hagenbuch “will send a clear signal that the board needs to be refreshed, not only with new members, but with new ideas and perspectives to rebuild Wynn’s reputation,” the adviser said in a report last week.

Elaine Wynn lost her seat on the Wynn Resorts board in 2015 after the board declined to nominate her and shareholders didn’t support her campaign to be reinstated.

In a statement after the company's announcement Monday, Elaine Wynn said the resignations of Hagenbuch and Miller represented “a good step towards establishing the ‘New Wynn,’ but there remains more work to be done.”

Leave your comment:
Subscribe to our newsletter
Enter your email to receive the latest news
EVENTS CALENDAR