Wynn-Wynn Face Off Will Be No Win for One Wynn in Wynn Resorts Share Battle

Posted on: March 29, 2016, 03:06h. 

Last updated on: March 29, 2016, 03:54h.

Casino mogul Steve Wynn, 74, and his first wife Elaine, 73, are engulfed in a full-blown War of the Roses over the Wynn Resorts empire. Ex-wife Elaine is suing the mogul in an attempt to wrestle back control of the stock in the multibillion-dollar company.

Steve and Elaine Wynn stake battle
War of the Roses: Steve and Elaine in happier times. The twice-married-and-divorced couple are now locked in a bitter custody dispute over Wynn Resorts shares. (Image: zimbio.com)

And in a war between two Wynns, someone has to lose.

Ms. Wynn is attempting to regain control of her near 10 percent stake in Wynn Resorts, currently worth some $900 million.

The filing in the State Court of Nevada seeks to void a 2010 shareholder agreement which, as part of an amicable divorce deal that same year, ceded Elaine’s voting control over her shares back to her ex-husband, and also restricted her ability to sell them.

The lawsuit demands compensatory and punitive damages for, among other things, Mr. Wynn’s failure to support his ex-wife’s reelection to the board of Wynn Resorts last year.

Trouble Brewing

The Wynns, who founded the gaming empire together in 2000, first married in 1963, divorced in 1986, then remarried in 1991, before divorcing again in 2010.

As part of the 2010 settlement, the couple split their stakes evenly, while Steve agreed to always reelect his ex-wife to the board of directors.

But Elaine filed against her twice-ex in 2012, her first attempt to void the deal. This was not in the interests of the shareholders, argued Steve, also noting that her push back relieved him of his obligation to vote for his ex-wife as a perpetual director. And thus, in April of last year, the former Mrs. Wynn was booted from the board.

Fast forward almost a year, and things have gotten really nasty between the former couple.

Reckless Accusations

Elaine’s lawsuit accuses Mr. Wynn of indulging in “reckless, risk-taking behavior” that may harm the company and expose it to damaging litigation.

“Elaine Wynn wants what is rightfully hers,” said Robert Siegfried, a spokesman for the once-missus. “She is extremely concerned based upon her well-founded knowledge of the company about the lack of corporate governance that has been rampant.”

Steve Wynn, not known to shy from battle, shot back at his ex-wife via an interview with The Wall Street Journal on Monday.

“There will be comeuppance for that as you will see shortly,” he said. “I’ve tried everything under the sun to help out, and nothing has worked. That’s not unusual in the world of divorces.”

Controlling Stakes

In an official statement, Wynn Resorts added its two cents to the warfare.

“This lawsuit is filled with lies and distortions and is an embarrassment to Ms. Wynn and her counsel. This is simply an attempt to inflict personal pain on Mr. Wynn. Ms. Wynn is a disappointed ex-wife who is seeking to tarnish the reputation of Wynn Resorts and Steve Wynn and their daughters.”

Steve says that he cannot let Elaine out of the 2010 settlement, because he would risk ceding control of the company, which would be damaging to its future and the interests of shareholders.

Ms. Wynn owns 9.8 percent of Wynn Resorts, while Mr. Wynn now owns 11.8 percent. But since the 2012 ousting of major shareholder and co-founder Kazuo Okada, who had also ceded control to Steve, two investment firms, Northern Cross LLC and South Easter Asset Management, now own more of the company than the two Wynns do together.

If this were a reality show, we’d be setting the DVR right now.