PENN Entertainment Fights Back Against Investor Claims Before Board Meeting

With a crucial proxy fight coming to a climax, PENN Entertainment has countered what it labels a string of deceptive accusations from HG Vora Capital Management, one of its biggest investors. The gaming firm put out an addition this week to challenge statements the activist hedge fund made in a recent 116-slide presentation.

PENN Backs Two HG Vora Nominees but Rejects Third Amid Regulatory Concerns

The fight revolves around PENN’s yearly shareholder meeting on June 17, where voters will choose two board members. PENN has backed two of HG Vora’s picks, Johnny Hartnett and Carlos Ruisanchez, but turned down the hedge fund’s third choice, pointing to regulatory issues. PENN stressed that HG Vora’s suggestions, which the company claims went against state gaming rules, stopped them from reaching a wider deal.

HG Vora’s presentation claims PENN botched its digital shift and wiped out over $11 billion in shareholder value since 2021. It also slams CEO Jay Snowden’s pay package and his use of company planes, hinting at a gap between executive perks and the company’s sagging stock performance.

PENN fired back, saying these claims twist available facts. The company pointed out that Snowden’s actual pay is less than half of his reported compensation and ranks in the bottom tier compared to industry peers. Additionally, 1.5% of corporate flight time was for personal trips, a number that PENN says HG Vora inflated by counting hours when the jets were rented out to others.

Hedge Fund Challenges PENN’s Online Sports Betting Push While Company Highlights Long-Term Growth

The hedge fund also points the finger at PENN’s leaders for putting online sports betting first, at the cost of its strong land-based casino business. However, PENN stands by its digital plan, pointing to its team-ups with ESPN and theScore as key to building a long-term, scalable customer ecosystem. The company believes these moves, along with its PENN Play loyalty program and strong retail presence, set it up well for future growth.

Rules and regulations have also stirred up trouble in this clash. PENN claims HG Vora tried to dodge licensing rules in its push to gain more sway over the board, something the hedge fund says is not true. The company stresses that staying in line with regulations is crucial to protect its 30-year standing in the gaming world.

Despite the disagreement, PENN says it is still eager to talk with shareholders and grow the business. As the vote gets closer, the result could affect where one of North America’s biggest gaming companies goes from here.