Penn Entertainment issues addendum for HG Vora ‘misstatements’
The operator is currently being sued by HG Vora in the US District Court for the Eastern District of Pennsylvania regarding the reduction of seats on its Board of Directors.
Key Points
- On May 15, Penn Entertainment sent a letter to its shareholders condemning HG Vora’s “reckless approach” and labelling its recent actions as a “blunderbuss campaign”
- The operator stated within the addendum it attempted to reach a settlement with HG Vora “in good faith,” but has seen the company reject all proposals up to this point
Following a 116-page investor presentation by HG Vora Capital Management on May 21, Penn Entertainment has issued a new addendum for shareholders to “set the record straight on these false mischaracterizations.”
The issue originally stems from a lawsuit filed by HG Vora on May 7 in the US District Court for the Eastern District of Pennsylvania regarding the reduction of seats on Penn Entertainment’s Board of Directors.
HG Vora believes Penn Entertainment violated the shareholders’ interests when it decided to reduce the number of seats up for election from three to two at the operator’s upcoming 2025 Annual Meeting of Shareholders. The company was eventually successful in achieving changes to the Board of Directors and now represents 25% of the continuing Board, although the lawsuit is still ongoing.
“While we attempted to reach a settlement with HG Vora in good faith, HG Vora rejected all of our proposals and insisted on imposing other conditions that violated directives from a gaming regulator and, therefore were not demands with which we could comply,” Penn Entertainment’s Board of Directors said.
“Penn’s gaming licenses are our most valuable assets – we understand and take our regulatory obligations seriously and, over our 30-year history in the industry, PENN has earned a reputation of trust with our regulators and the communities in which we operate. HG Vora, on the other hand, has consistently disregarded the gaming regulatory regime in its pursuit to exercise control and influence over PENN without all necessary licenses.”
Good to know: Penn Entertainment formed a new licensing partnership with Shake Shack on May 21 to launch the well-known burger brand at 10 properties run by the operator, with the first debuts set to take place during 2026
The Board of Directors continued to speak on how HG Vora has “chosen to test the boundaries and blame-shift,” and reportedly sought to “weaponize the company’s regulators,” according to Penn Entertainment.
“That same disregard is evident in HG Vora’s campaign of misstatements and insinuations about the Company’s Board and management team,” Penn Entertainment said.
“We understand that claims of management enriching themselves with excessive compensation, personal use of corporate aircraft, or timely insider selling are attention-grabbing headlines; however, HG Vora’s claims are simply not based on the facts readily available in our public disclosure.”
Penn Entertainment has even stronger words for HG Vora as part of a letter sent to shareholders on May 15, condemning HG Vora’s “reckless approach” and labelling its recent actions as a “blunderbuss campaign.”
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