Casino mogul Steve Wynn, hit by sexual misconduct claims, sells entire stake in his company

A file photo of US casino magnate Steve Wynn during a news conference in Macau, on June 5, 2012.
A file photo of US casino magnate Steve Wynn during a news conference in Macau, on June 5, 2012.PHOTO: REUTERS

LOS ANGELES (BLOOMBERG) - Steve Wynn sold his remaining 8 million shares in Wynn Resorts Ltd, swiftly eliminating one of his last ties to the casino company he founded.

Separately, in a surprise step, Wynn Resorts sold 5.3 million newly issued shares of common stock to Galaxy Entertainment Group Ltd, giving the competing Macau casino operator an estimated 5 per cent stake in the company, according to a statement on Thursday (March 22).

The twin moves hint at the future of Wynn Resorts, post-Steve Wynn, who stepped down in February following allegations of sexual misconduct. The Las Vegas-based company is under investigation by casino regulators in Nevada, Macau and Massachusetts, all of whom have the power to revoke the company's casino license or order Steve Wynn to divest his shares. The sales eliminate the latter option.

The sale of new shares to Galaxy, one of only six casino license-holders in Macau, positions that company as a potential suitor if Wynn Resorts were up for sale.

"This is a unique opportunity to acquire an investment in a globally recognized entertainment corporation with exceptionally high quality assets and a significant development pipeline," Galaxy Entertainment Group Vice Chairman Francis Lui said in a statement.

The new shares were sold at US$175 each, Wynn Resorts said, for a total of about US$927.5 million. The company plans to use the proceeds to repay an US$800 million loan it took out to settle a longstanding feud with Universal Entertainment, one of its original investors.

Steve Wynn sold his remaining shares to two institutional investors who already hold Wynn Resorts stock, a spokesman said. His shares also went for US$175 each, or US$1.4 billion. The transaction followed the earlier sale of 4.1 million shares, also announced on Thursday.

Since stepping down, Steve Wynn settled a six-year fight with his ex-wife Elaine Wynn, giving her the right to vote and sell her roughly 9 per cent stake in the company.

The company also settled its fight with Universal, agreeing to consult with that company's casino in the Philippines. Under new CEO Matt Maddox, several long-serving members of Wynn Resorts' board have left the company.