What will each Wynn do now?

What will each Wynn do now?

March 27, 2018 3:10 AM
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Asking what is next for Wynn almost deserves an automatic rhetorical retort of which one – Steve, Elaine or the resort company?

If asking about Steve Wynn, his two year non-compete clock is running, and while there are still matters to resolve in the various investigating jurisdictions, nothing says he can not start shopping and planning for his next project or projects.

Mr. Wynn has talent, proven track record, and even after federal taxes probably around a billion and a half in cash to play with. As a talented hotel operator, he could start a luxury collection of hotels, buy or create a gaming cruise line, go to any new emerging Asian gaming market and work his magic in nearly a virgin market or even go back to Macau.

Let’s consider Macau for a moment. The gaming concession licenses are coming up for renewal in 2020 and 2022. 2020 is two years from now, and Mr. Wynn’s non-compete will be ending around then. David Chow (who if memory serves me correctly used to work for Steve Wynn at the Golden Nugget many years ago) is an existing gaming operator under a sub-license with Stanley Ho in Macau and has been advocating for an expansion in the number of gaming permits. While he operates his own gaming company, if a new license were granted and Chow secured it, there would be no stretch of the imagination to see Steve Wynn and Chow do a deal of some kind.

If Mr. Wynn did not have such a history of building, it would be easy to think he might spend the rest of his days art collecting and living the lifestyle of the cultured elite, but he has never been known to just sit still.

If asking about Elaine Wynn, while it is very easy to see her entering the gaming market with a company of her own, it is just as easy to see her buying an NBA team with thoughts of bringing it to Las Vegas, or also simply enjoying the rest of her life indulging in art collecting and anything else she wishes. After all, with a billion dollars she could easily spend $250,000 a day for the rest of her life and probably still have plenty of money left over for her children.

If asking about Wynn Resorts, well that is a different story. While Mr. Wynn has sold off all his shares in Wynn Resorts, he is far from done with the gaming investigations. Just because you have left Nevada gaming does not mean Nevada gaming has left you.

It may seem odd to most, but when you surrender your Nevada gaming License the licensee, in this case Steve Wynn, needs to request either personally or through his former company a withdrawal of his gaming application. As the Nevada Gaming regulators are likely to want to continue to investigate, they may not be in such a hurry to process a request to withdraw his application, as absent the application, they would probably have no ability to compel any cooperation from Mr. Wynn.

However, Wynn Resorts will be compelled to continue to cooperate in any ongoing investigations. If the Commission, through its subordinate Gaming Control Board, finds some of the allegations of sexual harassment to have merit, then the regulators will likely subject Wynn Resorts to fines and some compliance requirements as the Nevada Gaming Commission may so deem appropriate.

Going forward though, Wynn Resorts with the exceptionally smart move of gaining Galaxy Entertainment Group as a significant investor has likely gotten themselves some much needed insurance and strength of relationships within the regulatory environment of Macau. Whether it will lead to a merger of the two gaming companies is one of many future options and certainly worth continued attention. However, Wynn’s new CEO Matt Maddox so far is making all the right moves to protect and build the company.

Throughout all the mess around the Wynn allegations, something that remains bothersome is the question: Were the allegations, claims, settlements and other records, as reported in the press, found by one or more of the past investigating gaming regulators or not? If not, why not? And if yes, why, if there were teeth in them, were they seemingly ignored?

Having been licensed myself many a time, I know the investigation process is very detailed and exhaustive, including the tracing of all funds through bank accounts, so it is very hard for this writer to believe the reported settlement(s) were not previously known.

Perhaps someday the various regulatory heads will share their side of the Wynn story as well, if for no other purpose than to restore or have the public’s confidence in the system.