Important highlights from upcoming meetings, provided by Glass Lewis’ global research team
Wynn Resorts, Limited
NASDAQ – May 16
Following the publication of serious and far-reaching accusations of sexual misconduct by founder and company namesake Steve Wynn, the board of Wynn Resorts has scrambled to separate the company from the increasingly questionable legacy of its former CEO. While portions of the board’s response, including the appointment of three new female directors, appear to indicate a genuine intention to pivot away from the “old Wynn”, other actions seem to undermine the intended message. Missteps include appointing a personal friend of Mr. Wynn to a special committee charged with reviewing accusations against him, as well as publication of an awkwardly fawning press release regarding Mr. Wynn’s resignation which shows no recognition of the gravity or severity of the claims against him. These actions, together with Wynn Resorts’ less than stellar compensation practices and increased regulatory risk, have again drawn the ire of Elaine Wynn, the company’s co-founder and largest shareholder, whose solicitation shines a rather bright light on the suspect remnants of Wynn’s old guard.
Deutsche Börse AG
Deutsche Börse – May 16
At last year’s AGM, Deutsche Borse was contending with an aborted merger and allegations of insider trading by CEO Carsten Kengeter. One year on Mr. Kengeter is gone, having resigned in the face of ongoing investigations by the public prosecutor’s office and the German Federal Financial Supervisory Authority, and the board is facing tough questions over its handling of the situation. In particular, chairman Joachim Faber has received considerable criticism in relation to contingency planning: Mr. Kengeter had been under investigation for months, and his contract was due to expire in March 2019; yet it appears that a search for Mr. Kengeter’s successor only commenced after his resignation. That sucessor is Theodor Weimer, who reportedly intends to press forward with organic growth rather than M&A activity — with substantial further changes to the board and senior management a possibility.
CSX Corporation
NASDAQ – May 18
Just eight months after CSX shareholders approved an $84 million dollar pay package to secure Hunter Harrison as CEO, the railroad legend extraordinaire sadly passed away. From Steve Jobs’ leave from Apple to Oscar Munoz at United Continental, the handling (and disclosure) of executive medical issues have long presented a challenge for boards. In this case though, given the price tag and the timing, the analysis has largely focused on due diligence, as if Harrison were a capex acquisition rather than an executive appointment. While some see his short tenure and appointment of Foote as setting the backbone for the company’s future, the board may nonetheless have to explain how much they actually knew about his health prior to hiring him. It should know more about current CEO James Foote — in response to a withdrawn shareholder proposal, the board now requires that the chief have an annual physical exam. Whether that’s enough to placate shareholders on the hook for Mr. Harrison’s dearly departed $84 million remains to be seen.
Playtech plc
London Stock Exchange – May 16
The house always wins. It’s true at the casino, and apparently true at London-listed gambling company Playtech plc, where executives received significant bonuses despite missing EBITDA targets. The payouts came thanks to an exercise of discretion by the remuneration committee, which “took acount of currency factors, ongoing provisions and research and development costs as well as the overall achievements of management during a challenging period in some of the markets in which the Company operates.” That same discretion isn’t afforded, say, the bettor who doubles down on 10 against a 5 only to watch the dealer make 21 — or Playtech’s investors, who’ve seen their shares drop ~20% since the company issued a profit warning in November 2017. Coming on the heels of >30% opposition to the company’s remuneration report and policy proposals at the 2017 AGM, and majority opposition to a one-off award for the CEO, will this be enough to break the bank?
Aetna Inc.
New York Stock Exchange – May 18
Call it growing pains. In 2017, Aetna’s tie-up with Humana was blocked by the Department of Justice, and the healthcare company had to pay the termination fee on the deal; this year it’s a pending merger with CVS that is subject to DOJ review. The deal was approved by shareholders at a special meeting in March 2018, but not all of them approve — a number of investors have lodged complaints, the board may face some tough questions with respect to the deal at the AGM. Another potential topic of conversation is the company’s recent announcement that it would pull out of the state exchanges established by the Affordable Care Act, which is apparently not affordable enough for the company.
Fnac Darty
Euronext Paris – May 18
After having taken the company from strength to strength, and having notably overseen the acquisition of Darty, chair and CEO Alexandre Bompard departed for pastures new, taking the helm at another French retailer – Carrefour. Aided in part by strong share price performance under his leadership, one of the youngest CEOs in the SBF 120 has also been one of its best paid, with realised pay exceeding €10 million in recent years. Not content with that, however, Fnac Darty has sought to give Bompard a parting gift of €5 million by altering the presence conditions under his old LTI plans. Also at the meeting, shareholders will have to vote on nominees for the board of directors put forward by activist SFAM Développement, who recently acquired over 11% of the company’s shares in a surprise move. SFAM have been coy about their intentions, though give no indication of desiring a significant strategic shift for a company that is performing well.
OTHER NOTABLE MEETINGS:
- ConocoPhillips (New York Stock Exchange – May 15)
- JPMorgan Chase & Co. (New York Stock Exchange – May 15)
- Air Liquide (Euronext Paris – May 16)
- State Street Corporation (New York Stock Exchange– May 16)
- AstraZeneca plc (London Stock Exchange – May 18)
- CBS Corporation (New York Stock Exchange – May 18)
- Paddy Power Betfair plc (London Stock Exchange – May 18)
- Altice N.V. (Euronext Amsterdam – May 18)