Wynn Resorts shareholders were delighted by Wednesday’s news that the company had declared an $8 per share special dividend and would be doubling its quarterly dividend to $1 per share in 2013. Not so delighted was Universal Entertainment chairman Kazuo Okada, whose 24.5m Wynn shares were forcibly redeemed at a 30% discount in February after Wynn’s lawyers claimed Okada had been too chummy with Philippine gaming regulators. We positively suck at math, but even we can figure out that Okada’s ongoing legal tussle with Wynn cost him almost $200m this week, and a further $25m every three months in the new year. And that’s on top of the $700m lost via the discounted redemption. Seriously, it’s enough to make you think ‘Kazuo Okada’ is Japanese for Charlie Brown.
Wynn Resorts chairman Steve Wynn has stated that his relationship with Okada started going sour after Okada suggested the then-BFFs should build a casino in Manila’s Entertainment City complex. Okada’s decision to go it alone in Manila after Wynn declined to participate irked Steve, in part because he didn’t want a partner providing regional competition. Yet Wynn’s current BFF Sheldon Adelson has gone on record as saying the Asian market would “never be satisfied in my lifetime” and “will probably not be satisfied in [his much younger interviewer’s lifetime],” suggesting there were sufficient numbers of Asian gambling whales to go around.
Even Steve acknowledges – at least, when he’s not trying to justify kicking a former partner to the curb – that the all-important Chinese market has, to borrow a phrase from John Paul Jones, not yet begun to gamble. In a post-earnings conference call with analysts on Wednesday, Steve was asked about the recent slowdown in VIP business in Macau and asked to comment on the suggestion that most of the wealth in China had been ‘tapped’. The short answer: fuck, no. “Every time we think we’ve got a line on [China], we get surprised. The country is so huge and the percentage of penetration of the gaming, based upon the repeat visitation [to Macau], is so small that I don’t think that we have done that … I believe there will come a time when the invitation to Macau will be so loud, so strong that people will start to come from even further away. So I think we’re on solid ground as far as long-term growth.”