Billionaire Steve Wynn is not happy with the government of Macau.
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The casino magnate let loose on a conference call Thursday after his company's Macau division reported a net revenue decline of nearly 40%.
'In my 45 years of experience, I've never seen anything like this before,' Wynn said.
Steve Wynn, the former chief executive of Wynn Resorts Ltd, has disposed his entire 11.8 percent stake in the firm for $2.1 billion in a dramatic exit of the casino and hotel enterprise he founded. Billionaire Steve Wynn is not happy with the government of Macau. The casino magnate let loose on a conference call Thursday after his company's Macau division reported a net revenue decline of.
Macau, like Hong Kong, is a Special Administrative Region of China. It is also the only place in China where gambling is legal. Since 2002, its casino industry has grown into a $45 billion heavyweight, roughly seven times bigger than Las Vegas.
But now, VIP gamblers are fleeing Macau in droves because an intense anti-corruption campaign in Mainland China has made them wary of visiting casinos. The industry is also taking a hit from new government rules.
Wynn said he is particularly flummoxed by the local government's decision to limit the number of tables allowed at new casinos, including one that his company is building.
'The table cap is the single most counter-intuitive and irrational decision that was ever made,' Wynn said. 'Here we are spending billions of dollars ... and then arbitrarily somebody says, 'well you should only have this many tables.' No jurisdiction ever has imposed that kind of logic on us.'
The vast majority of Macau's revenue currently comes directly from the casinos, and the territory is trying desperately to diversify its economy beyond gambling.
The obvious starting point is to boost its entertainment and leisure options, which lag far behind the glitz, glam and family fun offered in Vegas. The idea is to offer guests a more complete resort experience.
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Wynn(WYNN) is happy to build more attractions, but he said that government officials should not seek to limit the industry's core business.
'We built tens of thousands of rooms and restaurants and attractions, but they say, 'you're not allowed to gamble, because you can't have the tables.' Well that's one of the reasons they come to Macau.'
The frankness of Wynn's remarks were a notable departure from the jargon and corporate speak that typify earnings calls.
'I don't know that this has been the most satisfying quarterly phone call we've ever had, but at least it's the most candid and the most honest one that we could possibly give everybody that is interested in our company,' Wynn concluded.
Wynn shares were sharply lower in premarket trading.
Officials in China's gambling enclave of Macau have raised concerns about sexual misconduct allegations against casino mogul Steve Wynn.
The intervention adds to mounting pressure on Wynn and Wynn Macau(WYNMF), the business that generates most of the profit for his gambling empire. The Hong Kong-listed division of Wynn Resorts(WYNN) has lost more than $2 billion in stock market value over the past two days.
The plunge comes after a Wall Street Journal investigation uncovered decades of sexual misconduct allegations made against Wynn, the 76-year-old founder and CEO of Wynn Resorts. The company's board of directors has launched an investigation into the allegations, which Wynn has denied.
In a statement Tuesday, Macau's Gaming Inspection and Coordination Bureau said it had expressed concern about reports of Wynn's 'involvement in inappropriate behavior' during a meeting with Wynn Macau's leadership. It said it has asked the company for more information.
The Macau government 'pays great attention to appropriate qualifications of gambling companies' main shareholders, board members as well as key employees holding important positions, and will strictly implement relevant provisions,' the bureau said.
Wynn Macau said in a brief statement that it will fully cooperate with any requests from the bureau. Wynn is the chairman and CEO of the Macau unit.
Wynn Macau shares sank nearly 5% in Hong Kong on Tuesday, following a 6.5% drop on Monday. Meanwhile, Wynn Resorts' stock has been hammered in the U.S., plummeting 10% on Friday and 9% on Monday.
Macau is a tiny former Portuguese colony that is the only place in China where gambling is legal. Gaming revenues in the city dwarf those of Las Vegas.
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Wynn is one of a handful of companies licensed to operate casinos in the Chinese territory. It runs two huge resorts there, Wynn Macau and Wynn Palace, which together generated about 65% of Wynn Resorts' total operating profit last year.
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Following the allegations about Wynn reported by The Wall Street Journal, the Massachusetts Gaming Commission has said it is reviewing a license it previously issued for a resort casino to Wynn Resorts.
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-- Yazhou Sun contributed to this report.
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