[bsa_pro_ad_space id=1 link=same] [bsa_pro_ad_space id=2]

Skip to Content

Operator News

US – Bloomberg columnist tips Genting to look at win Wynn situation

By - 22 March 2018

Former Wynn Resorts CEO and Founder Steve Wynn has sold 4.1m shares in the company for US$739m, reducing his stake down to 7.8 per cent from 12.1 per cent in a move that could trigger a takeover.

Mr Wynn said he could still ‘sell all’ of his shares in the company with one analyst believing Malaysian casino group Genting could be one of the favourites to take advantage.

In a SEC filing, Mr Wynn said he could sell his stock ‘in an orderly fashion and in cooperation with the company,’ either on the open market or in privately negotiated transactions. Some analysts are predicting that the company could even consider a complete takeover.

Bloomberg columnist David Fickling believes that entry into Macau would make a deal very appealing for Malaysian casino operator Genting.

Genting Chairman Lim Kok Thay, pictured, said back in 2002 that Genting wanted to operate in Macau. “The door is closed,” he said. “When it next opens, we would be the first one knocking on that door and try our luck.”

Mr. Fickling said: “The door is open a crack. While Genting Singapore’s market cap of S$13.4bn ($10.2bn) falls well short of Wynn’s $18bn, it has S$2.6bn in net cash and racked up free cash flows of S$1.15bn during 2017; a figure exceeded only by Wynn Resorts itself and Sheldon Adelson’s Las Vegas Sands Corp. and Sands China. Genting would be able to add Wynn’s high-end glitz and substantial cash flows to its own more mass-market charms in the competitive bidding for a Japanese integrated resort license, too.

“Having properties on multiple continents is important for casino companies, who like to be able to offer their most lucrative high-rollers new destinations,” he added. “Genting at present is a second-division player in the global casino industry, but a combined business could duke it out with MGM Resorts International and Las Vegas Sands at the top of the big league.”

However any deal could be drawn out as Mr. Wynn’s termination agreement prevents him from off-loading more than one-third of his shares in any given quarter.

Mr. Wynn, who stepped down last month following allegations of sexual misconduct, owns an 11.8 per cent stake in Wynn Resorts worth around $2.2bn. Mr. Wynn’s ex-wife Elaine Wynn owns 9.5 m shares.

Analysts at Jeffries said: “The ownership structure is clearly evolving, although we do not believe all of the (21.6m) shares owned by the Wynns will be forced into the market.”

Analysts at Nomura Holdings added: “Given the circumstances surrounding Mr. Wynn’s departure, it is unlikely he will return to have a major role or equity stake in another public company As with most ‘retired’ individuals, he now joins the ranks of investors who need to diversify their portfolios and maximise their incomes.”

Share via
Copy link