Casino mogul Wynn dumps Okada from Macau board

Posted at 02/24/2012 2:38 PM | Updated as of 02/24/2012 2:38 PM

MACAU - Wynn Resorts CEO Steve Wynn ousted his former friend and billionaire partner Kazuo Okada from the board of his Wynn Macau casino, the latest twist in a legal battle that has implications for their multibillion-dollar businesses.

A board decision to un-seat Okada was effective immediately, the company said in a filing to the Hong Kong stock exchange on Friday.

"The board determined that it was obligated to remove Mr. Okada as a non-executive director given the unacceptable conduct by Mr. Okada, his employees and associates detailed in the independent report," it said, referring to an internal investigation by the company.

Wynn Resorts said earlier this week it forcibly redeemed Okada's nearly 20 percent stake in the company, adding the internal investigation by former FBI Director Louis Freeh revealed Okada, chairman of slot and pachinko gaming firm Universal Entertainment Corp (6425.OS), and associates violated U.S. anti-corruption laws.

Okada, an engineer by training who helped bankroll Wynn's $14 billion gaming empire, remains on the board member of parent Wynn Resorts as it can't remove the Japanese businessman without first convening a special shareholders' meeting, a person with knowledge of the meeting told Reuters this week.

The nine-person board of Wynn Macau includes five members with ties to Wynn. Shares in the company were down 0.1 percent at the Friday midsession, in line with the benchmark index.

The public falling-out between the two self-made tycoons was triggered last month when Okada filed a suit against Wynn for blocking access to financial documents related to a $135 million donation by Wynn Resorts to the University of Macau.

Each now claims the other made improper payments to foreign gaming regulators to win favor in their respective Macau and Philippines markets, and the acrimony has attracted the attention of legal regulators, investors and analysts worldwide.

Partners to rivals

Steve Wynn, the Vegas showman known for building high-end properties such as the Bellagio and Mirage, has maintained that Okada - after whom he named his casinos' upscale Japanese restaurants - went against a board decision to pursue a property in the Philippines, making him a direct competitor.

Okada is seeking to file a suit in Las Vegas for a temporary restraining order and preliminary injunction to protect the interests of his subsidiary, Aruze USA, Inc in Wynn Resorts and to prevent the redemption of its shares.

Estimated to be worth $2.1 billion by Forbes magazine in 2011, Okada made his riches in pachinko - a uniquely Asian game that mixes slot machine style gambling with pinball, and which rakes in about 20 trillion yen ($250 billion) annually.

A resident of Hong Kong where he lives with his wife and young daughter, Okada was Wynn Resorts' largest shareholder, holding more than double the stake of Steve Wynn himself.

Okada had said earlier he did not plan to attend Friday's planned board meeting, writing to the board that he disagreed with his ouster and it would be meaningless to turn up as his ejection was all but certain.

"I do not want to embarrass you, as my colleagues, by forcing you to make false and defamatory statements about me in my presence," Okada wrote in the letter, a copy of which was received by Reuters.

"I disagree with the decision to remove me as a director, because it is based on false and misleading assertions in a report that was created only to serve as a means to discredit me."

Okada was not immediately available for comment after the Wynn announcement.

A second court hearing on Okada's lawsuit against Wynn, originally scheduled for Thursday, was delayed until March 8. No reason was given for the change.