Okada is no problem, says Wynn’s Weaver
Steve Wynn’s epic fight with Japanese businessman Kazuo Okada could throw a monkey wrench into the American magnate’s bid for a casino license in Japan, Okada’s homeland.
Research firm Morningstar says the Japanese government—which is exercising extreme caution as it develops Part II of its casino legislation—will base its choice of operators in part on working with blemish-free partners, reported the Las Vegas Review-Journal.
The battle of the casino titans started in 2012, when Wynn gave Okada the boot as vice chairman of Wynn Resorts, then forcibly redeemed his stake in the Las Vegas-based casino operator.
In a lawsuit, Wynn alleged that Okada—once a close friend—bribed Philippine officials to win a gaming license in that country along with tax and ownership concessions. Okada and his companies are being investigated by the U.S. Federal Bureau of Investigation due to a $40 million payment to a Manila consultant in 2010. Okada denies the bribery accusations and has countersued Wynn. Their fight is still ongoing.
Okada is now in more hot water, dogged by allegations of financial shenanigans at his own company. Universal Entertainment, parent company of the new Okada Manila resort in the Philippines, claims that the property’s namesake misused $20 million of company money during his time as chairman. Okada has since been removed from the position.
There are other problems for Wynn in Japan, reported the Review-Journal. Wynn Resorts has a more modest meetings, incentives, conventions and exhibitions presence than its peers—about 400,000 square feet of space globally while Sands has more than 5 million and MGM more than 3 million.
“While Wynn Resorts has a successful track record of constructing and operating luxury resorts, its involvement with bribery litigation, along with its weaker MICE and balance sheet position relative to MGM and Sands, leads us to believe that the company is unlikely to receive one of the two urban gaming concessions in Osaka and Yokohama,” wrote Morningstar.
But Wynn Chief Marketing Officer Michael Weaver dismissed Morningstar’s concerns about Okada, saying, “We don’t believe that will be a factor at all.” He was joined by Union Gaming analyst John Decree, who said, “There will be far more important criteria in awarding the gaming licenses.”
