Wynn Macau board ousts Japanese tycoon Okada

27-Feb-2012 Intellasia | AFP News | 7:01 AM Print This Post

The board of casino operator Wynn Macau on Friday dumped Japanese gambling tycoon Kazuo Okada as a director over what it called “unacceptable conduct” involving alleged corruption in the Philippines.

The subsidiary of US-based Wynn Resorts said the board resolved to remove Okada as a non-executive director “with immediate effect”, amid a bitter feud between the Japanese businessperson and one-time partner Steve Wynn.

The company issued a statement to the Hong Kong stock exchange saying it felt “obliged” to sack Okada after an internal Wynn Resorts investigation accused him of bribing Philippine regulators in his bid to build a rival gaming resort in Manila.

Wynn Resorts said in a lawsuit filed Tuesday in a Las Vegas district court that Okada, Japan’s pachinko king, went behind the company’s back to secure a stake in Asia’s booming gaming industry for his Universal Entertainment group.

It said Okada had lavished more than $110,000 on Philippines officials in apparent violation of the US Foreign Corrupt Practices Act.

Okada had pushed Wynn to form a joint partnership in the Philippines, but the Las Vegas company had rejected the idea partly because corruption was “deeply ingrained” in the Southeast Asian archipelago, the suit said.

The Wynn Resorts board voted Sunday to expel Okada as a director and to redeem his 19.7 percent stake in the group at a severe discount. Okada is reportedly trying to block the $1.9 billion buyback.

The Japanese tycoon and co-founder of the Wynn gaming empire has defended himself against the allegations, saying gifts are a regular part of doing business in Asia, especially in the gaming industry.

He has also lodged a suit of his own against Wynn Resorts, over a $135 million donation the Las Vegas company made to the University of Macau.

Analysts said the feud between Wynn and his former friend Okada looked set to escalate in the courts.

“We believe we are at the beginning, not the end, of this dispute,” CLSA brokerage regional head of gaming research Aaron Fischer told AFP in Hong Kong.

“If Wynn can maintain the current outcome then this would be extremely positive for Steve Wynn and his other shareholders.”

Wynn Macau shares rose 0.31 percent to HK$19.76 shortly after the announcement.

The US parent company hired former US Federal Bureau of Investigation chief Robert Freeh to conduct its investigation into Okada’s activities.

Its lawsuit accused him of offering payments and gifts to two regulators at the Philippines Amusement and Gaming Corporation (Pagcor), former chair Efraim Genuino and current Chair Cristino Naguiat, and their families.

Philippine authorities confirmed Wednesday that top gaming officials accepted free luxury accommodation from a Japanese tycoon but denied these were bribes to ensure a new Manila casino was built.

Pagcor awarded a licence to Okada’s Universal Entertainment in 2008 to build a gaming resort on the shores of Manila Bay featuring three hotels.

Wynn Resorts alleges the Pagcor officials’ relatives and associates also enjoyed Okada’s generosity, as did the husband of then-president Gloria Arroyo.

It says Naguiat, his wife, three children, nanny and company officials had a five-day trip to Wynn’s Macau resort in 2010, during which Okada met with the Pagcor chair to discuss his Manila casino venture.

Okada allegedly ordered that Naguiat be given the most expensive accommodation at the resort – a $6,000-a-night villa normally reserved for high rollers – as well as use of the casino’s best butler.

More than $50,000 was spent on Naguiat’s visit, including about $20,000 in cash given to the Filipino delegation for shopping and gaming, the suit alleged.

Naguiat also requested and received a Chanel designer bag worth more than $1,850 for his wife, according to the suit.-By Beh Lih Yi

http://sg.news.yahoo.com/wynn-macau-board-ousts-japanese-tycoon-okada-061144478.html

 


Category: Hong Kong

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