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Read Full BioHG Vora Capital Management sent a letter to PENN Entertainment shareholders on May 13, notifying them that it had filed its definitive proxy statement with the Securities and Exchange Commission (SEC).
The filing was in connection with the nomination of candidates for election to PENN’s Board of Directors.
HG Vora previously recommended three candidates to strengthen the Board. The company believes that the existing members are responsible for its poor performance since 2021.
PENN Entertainment responded to HG Vora’s initiative by attempting to block the nominations and reducing the number of available board seats from 3 to 2, effectively accepting Johnny Hartnett and Carlos Ruisanchez.
Both are industry veterans and experienced executives, but HG Vora’s third candidate, PENN’s former CFO and M&A expert William Clifford, was rejected despite having a proven track record.
HG Vora called this act “illegal” and “undemocratic,” which led it to address PENN’s shareholders, blaming the leadership of President and CEO, Jay Snowden, and Board Chair, David Handler. It stressed that PENN pursued a misguided transformation from a best-in-class regional casino operator to a sports, media, and technology conglomerate under their leadership.
HG Vora points to several data points, including an 80% share price decline in the past four years, suggesting that the decision to transform the company in this way was a failed strategy that has caused PENN to lose $11 billion in value since 2021.
PENN Responds to HG Vora With Shareholder Letter
PENN responded to the HG Vora letter by addressing the shareholders in its own letter.
The company suggested that the industry is undergoing a fundamental transformation. The Board of Directors and management team have transformed the business, building a digital presence and allowing it to engage with younger audiences outside of its traditional channels and demographics.
It also noted that it has taken, and continues to take, actions to drive growth and enhance profitability. It acknowledged the addition of two of HG Vora’s nominees for the June election after two incumbent directors stepped down, while another one, Ron Naples, has recently decided to retire.
PENN further emphasised its commitment to an omnichannel growth strategy, integrating digital platforms with its retail casino operations.
It highlighted a 10% YoY increase in PENN Play loyalty members, reaching over 32 million. It also noted that the average customer age has gone from 53 to 44 between 2019 and 2025.
Further, the company saw a 34% increase in digital customers within 50 miles of a PENN property, suggesting successful cross-channel engagement.
As for its engagement with HG Vora, PENN said that there have been over 25 meetings or calls since 2023. However, it also noted that it declined to nominate HG Vora’s third candidate due to concerns regarding his suitability and past opposition to key initiatives during his previous time with the company.
