Once upon a time, casino moguls Kazuo Okada and Steve Wynn were formidable business partners. It was Kazuo Okada who saved Steve Wynn when he invested $260 million to build the foundation of the current Wynn Resorts in the year 2000, after Wynn was ousted from Mirage Resorts Inc. in a hostile takeover.
Okada and Wynn were not only business partners, but best friends. They worked together and became the key players in the casino industry.
However, in 2012, Wynn betrayed Okada when he ousted him as the vice chairman of Wynn Resorts and forcibly bought the 20-percent stake of Wynn Resorts held by Universal Entertainment Group by issuing a promissory note at a 30-percent discount of the current market price.
Wynn exiled Okada to rebuild his empire. That event led to a string of lawsuits between the two moguls until the present.
But the fates of these two best friends-turned-bitter-enemies are quite intertwined.
Wynn was the undisputed King of Las Vegas and may have created and paved the way for the success of his empire. However, he recently bowed out as chairman and chief executive officer of Wynn Resorts after allegations of sexual misconduct were leveled against him. He has joined Hollywood mogul Harvey Weinsten and other powerful men who have been disgraced by sexual misconduct cases.
Okada has suffered the same fate, although not involving sexual misconduct but alleged business fraud and mismanagement.
In 2012 Okada started his project in the Philippines with a vision of setting the gold standard for five-star integrated luxury resorts. Indeed, with his multibillion-dollar investment, he gave the country’s tourism and entertainment industries a big boost.
Tiger Resort Leisure and Entertainment Inc. (TRLEI) is the developer, owner and operator of Okada Manila. While Kazuo Okada was the majority shareholder of Okada Holdings Limited, he was not the sole decision-maker.
However, as the delays in the project completion started to be apparent in 2016, an investigation on Tiger Resort Asia Limited (TRAL) and TRLEI was conducted. This resulted in the discovery of many acts of fraud, mismanagement and manipulation allegedly perpetrated by Okada himself to the prejudice of UEC.
The investigation showed that Okada had funnelled company funds, through TRAL and TRLEI, for his personal interests and done without prior knowledge of UEC (the company) or the board of directors.
The following were the results of the investigation conducted by the Special Investigation Committee of Universal Entertainment Corp.
To save the company, Tomihiro Okada (son of Kazuo Okada) who holds 43 percent of Okada Holdings Limited, and Hiromi Okada (daughter of Kazuo Okada) who holds 9 percent of Okada Holdings Limited, banded together and exercised their right to vote on May 12, 2017, and dismissed Kazuo Okada from Okada Holdings Limited.
His dismissal from the holding company set in motion his ouster from the other companies. On May 23, 2017, UEC held a Special Meeting of the Board and issued a suspension order on Kazuo Okada.
In June of 2017, Kazuo Okada was dismissed as the director of Tiger Resort Asia Limited. Kenshi Asano and Takako Okada were nominated as the Directors of Tiger Resort Asia Limited. TRAL, as the 100-percent shareholder of TRLEI, the owner and operator of Okada Manila, removed Kazuo Okada from the board of directors and as the Chairman and CEO of Okada Manila.
On June 29, 2017, Universal Entertainment Corp. held its annual stockholders’ meeting where Kazuo Okada was dismissed as one of the directors of the board of UEC. Kazuo Okada was completely removed from the Universal Entertainment Group.
The company and family members of Kazuo Okada made a decision to take a stand in making things right. This change has also been welcomed by the market. The shares of UEC have nearly doubled since the dismissal of Kazuo Okada.
Kazuo Okada, however, has been making attempts to regain his footing in Okada Holdings Limited using his own daughter Hiromi to claim he is staying on as the dominant shareholder. But nothing could be further from the truth, as his cases are still under litigation in various courts in Japan, Hong Kong and South Korea.
He is also facing various criminal charges in the Philippines.
The fates of these two disgraced casino tycoons serve as cautionary tale that, in crime, nobody really gets away because the truth will always find its way out.
E-mail: ernhil@yahoo.com.