Universal stock slumps after Wynn settlement

Universal Entertainment shares slumped a further 13 percent Monday, continuing a decline triggered by last week’s settlement of a legal case with Wynn Resorts.

The stock dropped from 6,250 yen before news of the settlement Thursday to 4,590 yen by the end of the day Monday, a loss of more than 26 percent of its value.

The company’s announcement of a much higher net income forecast for the remainder of this calendar year did nothing to stop the slide.
While US analysts generally regarded the settlement as a positive step for Wynn Resorts, it appears that Japanese traders felt that the US$2.4 billion payout to Universal was considerably less impressive than they had expected.

The sharp drop in the company's stock may also reflect concerns that former Universal Entertainment head Kazuo Okada was not a party to the agreement and thus additional trouble might be expected from that quarter.

Universal said it expects to record a significant jump in net income for the fiscal year ended Dec. 2018 as a result of the settlement, which relates to forced redemption in 2012 of a 20 percent stake the Japanese company held in Wynn. Universal was given a promissory note in return for its shares.

As a result of the settlement, Universal said it has revised its net income forecast from JPY 15.9 billion to JPY 195.5 billion, more than a 1000 percent increase.

Wynn Resorts said on Monday it has agreed on a 364-day term loan for us to $800 million with Deutsche Bank to repay the promissory notes.

More news from this jurisdiction

Japan, ElsewhereTuesday, Dec 05, 2017

Sega Sammy Creation has secured a license for the sale and distribution of gaming machines in Nevada, as of December 1.

Elsewhere, Japan, Macau, South East AsiaWednesday, Nov 29, 2017

Spectrum Gaming Group says it predicts 2018 to be the most significant, with political, technological, demographic and regulatory changes expected for gaming markets around the world.

Japan, ElsewhereFriday, Oct 20, 2017

Norio Tomonaga, mayor of Sasebo city, Nagasaki Prefecture, visited Las Vegas on Monday as part of a week-long official tour of the United States.

Japan, ElsewhereTuesday, Mar 14, 2017

Spin Games said it will have an exclusive right to distribute new Konami content via the Spin ROC Remote Gaming Server to approved operators in Europe.

Elsewhere, JapanSunday, May 03, 2015

The American Gaming Association welcomed Japanese Prime Minister Shinzo Abe and members of the Diet to Washington as part of the AGA’s bid to play a leading role in informing ...

ElsewhereThursday, Mar 22, 2018

Pari Mutuel Urbain (PMU) is seeking growth opportunities in Asia after a push into international markets helped to drive 2 percent growth in revenue last year, the first in five years.

JapanThursday, Mar 22, 2018

The Japanese government leaked to the media on Thursday that operators are likely to be required to report any casino chip-cash exchanges that exceed 1 million yen (about US$9,500).