Johnny Hartnett and Carlos Ruisanchez were both elected as new members of the Penn Entertainment board Tuesday morning.
The annual meeting has made headlines over the past month as HG Vora fought to get a third person, Bill Clifford, elected to the board. HG Vora’s proxy card, which included Clifford as a third nominee, received “more than 55% of all votes cast” according to the the firm’s post-meeting press release.
Penn’s board welcomed the two new directors in a release following the meeting. An 8-K with final results from the meeting will be filed “in the coming days.”
Penn’s share price was unaffected by the results.
Penn ‘intently focused’ on interactive profits
Penn has been fairly transparent about acknowledging its interactive issues and believes the board, management and shareholders are now “aligned in their focus on ensuring PENN is achieving its full potential.”
“The Board remains committed to the close oversight of our differentiated omni-channel strategy and to delivering sustainable long-term value,” read the board’s statement. “We recognize there is more work to be done, and we are intently focused on driving profitability in our Interactive segment and growth across the business as we continue strengthening the Company’s balance sheet and liquidity position, deleveraging and accelerating capital return to shareholders.
“We look forward to further dialogue with our shareholders about our Board’s composition and skillset evolution, as well as PENN’s executive compensation program and strategic priorities, to ensure alignment with our shareholders.”
HG Vora ‘grateful’ for nominee support
Out of Penn’s 30 top institutional investors, HG Vora said “approximately five” of them voted on Penn’s white proxy card, according to early tabulations from HG Vora’s proxy solicitor, Okapi Partners.
“William Clifford, the third independent director nominee put forth by HG Vora and whose proper nomination the Company refused to acknowledge, was supported by dozens of institutional investors and actively managed funds and received a majority of votes cast in the election,” the statement said.
HG Vora founder Parag Vora expressed confidence in the two selected nominees.
“PENN’s shareholders have voted overwhelmingly for genuine change, including for the election of William Clifford to the Board,” Vora said. “There can be no mistake about the mandate from PENN’s shareholders that the status quo is simply unacceptable. We are grateful for the strong support the three independent nominees have each received from shareholders and are confident that Johnny and Carlos will work constructively with their fellow directors to drive shareholder value.”
Is that the end?
While the voting may be done, there is still an outstanding lawsuit from HG Vora that accuses Penn of breaching its fiduciary duties because the company allegedly improperly cut its available board seats from three down to two.
The latest from the Eastern District Court of Pennsylvania is a scheduled hearing on July 10 concerning HG Vora’s motion to expedite the trial and for an early case management conference.
HG Vora did not immediately respond to a request for comment when asked about its next steps.
