|dpa, BerlinMcClatchy-Tribune Regional
Feb. 20, 2012--NEW YORK -- Wynn Resorts Ltd forced out its largest shareholder by buying his 20-per-cent stake at a deep discount after a company-ordered inquiry accused him of making improper payments to gambling regulators in the Philippines.
Kazuo Okada on Monday called the casino-owning company's action "outrageous" and said he would take legal action to stop it, The Wall Street Journal reported.
The company asked Okada to quit its board and said Sunday that it would buy the 24 million shares owned by Okada at a price that was 31-per-cent less than its New York closing price Friday, saying such a discount was in accordance with the firm's articles of incorporation after he was found "unsuitable."
It said the move was meant to protect Wynn's gaming licenses.
A year-long investigation headed by former FBI director Louis Freeh and former Nevada governor Robert Miller accused Okada, a Japanese citizen, of giving payments and gifts valued at 110,000 dollars to gambling regulators, Wynn Resorts said.
The 24 million shares are held by Aruze USA Inc, a slot-machine maker owned by Okada's Universal Entertainment Corp. Wynn Resorts said it would buy out Aruze's 2.76 billion dollars worth of shares within 10 years for 1.9 billion dollars.
"Mr Okada and his associates and companies appear to have engaged in a long-standing practice of making payments and gifts to his two chief gaming regulators at the Philippines Amusement and Gaming Corp, who directly oversee and regulated Mr Okada's provisional licensing agreement to operate in that country," the investigative report said.
Okada has served as vice chairman of the Wynn Resorts board and is a member of the board of Wynn Macau Ltd, a majority-owned subsidiary. Wynn Resorts said it would recommend that he be removed from the subsidiary's board as well.
The findings represented an unravelling of the longtime partnership between Okada and Steve Wynn, co-founder of Wynn Resorts and chairman and chief executive of both it and Wynn Macau.
Okada accused Wynn Resorts of making an inappropriate 135-million-dollar gift last year to a Macau university as the companies sought to build a third casino in the Chinese gambling enclave.
The accusations were levelled as Okada is building a casino in the Philippines without Steve Wynn. The Philippines seeks to rival Macau and Las Vegas, the US city where Wynn Resorts has its gaming houses.
The company said Okada was the only member of its board who dissented with the "unsuitable" finding. It said he told the board that the gifts he was accused of making in violation of the US Foreign Corrupt Practices Act were permissible in Asia.
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