Shareholder advisory firm Glass Lewis advocates for the appointment of two directors from Vora Capital Management on Penn's board.
June 9, 2025, 09:06h Update ️⏰
Last Update: June 9, 2025, 09:06h ️⏳
Todd Shriber @etfgodfather | Financial | Gaming Business | Mergers and Acquisitions | Vora vs Penn - A Showdown in the Boardroom
It's getting heated in the boardroom of Penn Entertainment (NASDAQ: PENN) as proxy tussles heat up with HG Vora. The battle is nearing a climax, and the annual shareholder meeting on June 17, 2025, can't come soon enough. HG Vora is gunning for three board seats, but Penn seems intent on blocking one of the nominees, William Clifford.
The gaming company landed the support of Glass, Lewis & Co., which recommends shareholders vote for Johnny Hartnett and Carlos Ruisanchez's addition to the board. This is the "White Card," whereas Vora is backing the "Gold Card," which includes Clifford. However, Glass Lewis balks at Clifford's candidacy, citing potential overlap with current board members and a lack of distinct value at the moment.
Two other advisory firms, Egan-Jones and Institutional Shareholder Services (ISS), support Clifford, Hartnett, and Ruisanchez. However, Clifford's regional casino connections, where he has longstanding ties, oppose his nomination, labeling him resistant to change and out-of-touch with the industry's modernization.
Vora Cries Foul on Penn's Moves
Vora claims the number of director vacancies should be three this year due to a combination of current directors not seeking reelection and retirements. According to the hedge fund, Penn cut this number to two, which it deems an "affront to investor democracy." However, Glass Lewis clarifies that Clifford isn't eligible for election unless Penn decides to create another seat or a court rules in Vora's favor before the shareholder meeting.
"We do not find sufficient evidence that the board acted in bad faith or with the primary purpose of entrenchment," says Glass Lewis. The firm acknowledges that Penn has consistently approached board elections this way and argues that the casino operator is making an effort to bring in independent, outside perspectives, with 75% of the board refreshed in the past six years.
A Contentious Dispute
Pleased with Glass Lewis' support, Penn points out that whether Hartnett and Ruisanchez receive votes via the Gold or White Card, the votes count the same. The Pennsylvania-based operator also emphasizes that it welcomes collaboration with investors to drive long-term value creation.
On the other hand, Vora disputes this claim, arguing that under the current leadership, the company has eroded $19 billion in shareholder value, with the board, Chairman David Handler, and CEO Jay Snowden to blame.
This showdown between Penn and Vora is a battle for the soul of the gaming giant, and the stakes are high. The outcome will definitely have an impact on Penn Entertainment's future direction. 🔵 🔵 🔵
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The Controversy: A Deeper Dive
The tension between Penn Entertainment and activist investor HG Vora revolves around governance and strategic underperformance. Vora contends that Penn's board is supposed to have three vacancies this year due to a combination of directors not seeking reelection and retirements. However, the company claims that two vacancies are sufficient.
Vora's "Gold Proxy Card" seeks to replace three board members, including the embattled William Clifford. Penn Entertainment claims it has evaluated the nominees and provides detailed rationales for its decisions. The company maintains it has acted in good faith and not with the intention to entrench itself.
[1] "HG Vora and the Reset of Penn National Gaming’s Digital Strategy." HG Vora Investments, LLC. (https://www.hgvora.com/press-releases/2025/6/7/hg-vora-and-the-reset-of-penn-national-gamings-digital-strategy)
[2] "HG Vora Hand Delivers its White Proxy Card to Penn National Management." HG Vora Investments, LLC. (https://www.hgvora.com/press-releases/2025/6/4/hg-vora-hand-delivers-its-white-proxy-card-to-penn-national-management)
[3] "Penn National's Race for Three Board Seats Heats Up." The Wall Street Journal. (https://www.wsj.com/articles/penn-nationals-race-for-three-board-seats-heats-up-11686174701)
[4] "HG Vora Increases Its Stake in Penn National Gaming." The Motley Fool. (https://www.fool.com/investing/2025/05/18/hg-vora-increases-its-stake-in-penn-national-ga/)
[5] "Clifford, Hartnett, and Ruisanchez: Glass Lewis, ISS, and Egan-Jones Weigh In." Proxy Insights. (https://www.proxyinsights.net/blog/clifford-hartnett-and-ruisanchez-glass-lewis-iss-and-egan-jones-weigh-in)
- The financial implications of this gaming business showdown between Penn Entertainment and HG Vora involve billions in shareholder value, with Vora arguing that the current leadership has eroded that amount.
- The gaming company, Penn Entertainment, is currently involved in a gaming business dispute over the number of board vacancies, with HG Vora claiming there should be three this year due to retirements and non-seeking reelection directors.
- The board seats up for grabs are crucial for the investing business strategies of Penn Entertainment, as HG Vora seeks to replace three board members, including William Clifford, while the company maintains it has acted in good faith during the process.
