In the wake of sexual misconduct allegations that he denies, Steve Wynn resigned as chairman and CEO of Wynn Resorts and Wynn Macau. But that’s hardly the end of corporate Wynn’s links to its billionaire founder and potential fallout from the allegations against him. Events in the coming months will determine whether the companies Wynn founded are better off without him.

JPMorgan analyst DS Kim sees “surprisingly limited” implications for Wynn Macau from the resignation. Wynn himself has no direct holding in the Macau subsidiary, 72% owned by Wynn Resorts, so his resignation eliminates potential licensing issues. Wynn Macau also has little corporate business that might suffer due to “reputational issues” from the allegations.

Removing the founder could even be a positive given his volatile history with Macau authorities: at the dawn of liberalization in 2002, Wynn trumpeted he wouldn’t start construction until Macau specifically legalized collection of gaming debts through local courts, and in 2016, before the opening of Wynn Palace, he blasted the government’s table allocation policy. With Wynn Macau President Ian Coughlin and chief operating officer Linda Chen remaining in their jobs, and no imminent Macau development projects, Wynn’s resignation has little operational impact, Kim says.

“We think the top management in Macau will be able to run the business effectively,” Morningstar analyst Chelsey Tam writes. “The positioning in the high-end market is already in place and well-received, and we see no reason for Wynn Macau to change its positioning.”

Sanford Bernstein analyst Vitaly Umansky applauds new Wynn Resorts CEO Matt Maddox taking the same role with Wynn Macau and the chairman post going to Allan Zeman, father of Hong Kong’s Lan Kwai Fong entertainment district and a longtime Wynn director on both sides of the Pacific.

Maddox “has a good grasp of Macau operations,” Umansky writes with analysts Zhen Gong and Cathy Huang, noting Maddox served as Wynn Macau’s CFO 2006-08 and has visited frequently since. “He has been one of the closest executives to Steve Wynn and will likely try to maintain his vision and attention to hospitality and customer experience.”

The note continues, “However, the shoes of Steve Wynn will not be easy to fill. Even with Maddox at the helm, Wynn will likely become a somewhat different operation, but time will tell.” An earlier Bernstein note suggests, “Steve Wynn is Wynn” and that “he is more involved with day-to-day operations than most other CEOs.”

Uncertainties remain

Morgan Stanley Asia Pacific’s Praveen Choudhary warns there’s another shoe to drop. “Some investors might consider the resignation of Steve Wynn as the removal of an overhang on the stock, but we think that many uncertainties remain around who will be the controlling shareholders in future (Mr Wynn’s ex-wife, Elaine Wynn, major shareholder Kazuo Okada, or a new shareholder), if Mr Wynn decides to sell off his stake,” Choudhary, New York-based analyst Thomas Allen and research associate Jeremy An write. That could make Wynn Resorts a takeover target.

Elaine Wynn, twice married to and divorced from Wynn, holds 9% of company shares. Their (second) divorce agreement prohibits her from selling the shares or voting them independently. She is suing for full control of the shares, and a trial is due to begin in April.

Okada, the Japanese pachinko magnate and ousted Wynn vice chairman, had his nearly 20% stake in Wynn Resorts forcibly redeemed at a 30% discount in 2012 through what amounted to a corporate kangaroo court. Wynn’s board declared Okada’s Manila casino, which opened at the end of 2016, a threat to Wynn Macau’s business and Okada a threat to all Wynn licenses after an internal investigation questioned $110,000 in hospitality grants to Philippine officials at Wynn properties that were not flagged at the time. Okada’s lawsuit to recover his shares is also set for trial in April.

Unless Wynn’s shareholding is reduced from its current 12% to less than 5%, Morgan Stanley suggests, “gaming Control Boards would likely continue to scrutinize his involvement with the company.” Wynn has licenses in Nevada and Massachusetts, where it is building $2.4 billion Wynn Boston Harbor, and authorities in both states began investigating the company following the allegations.

The outcome of those two trials, and whether gaming regulators treat Wynn as harshly as they treated Okada, will determine the company’s future. The founder’s resignation leaves corporate Wynn with stability, but little certainty. As long as he remains the company’s largest shareholder, with a reminder of that posted on every hotel, he’s an issue for Wynn Resorts.