With a Push-out Score of 10, the CEO departure at Caesars Entertainment Corp. is at the top of the scale and seems stony.
As announced on November 1, 2018, Mark P. Frissora leaves his post as chief executive officer at the gaming corporation, effective February 8, 2019.
At 62 years, Frissora is at the normal retirement age. The lead time is a comfortable 99 days. His tenure of three years and seven months is still appropriate, and in the announcement from Las Vegas, Nevada-based Caesars, he receives accolades, praise and thanks.
Nevertheless, there is no reasonable doubt that he was under pressure to leave. Frissora was dethroned by Caesars.
Among the instantly visible red flags are the recently poor share price development, the fact that a reason for his departure is not explicitly given and the fact that a successor is not immediately available.
Moreover, Frissora steps aside at a critical time.
On November 1, Caesars also said that it turned down a recent offer from Tilman Fertitta’s Golden Nugget LLC proposing a reverse merger.
Caesars is under pressure from activist investors.
Caesars emerged from bankruptcy last year after a restructuring process that began shortly prior to Frissora becoming CEO.
On November 1, Caesars also released its third-quarter earnings report, which beat earnings estimates but missed revenue expectations.
Caesars traded at $12.80 after emerging from Chapter 11 and closed at $8.85 on November 1, 2018.
Is Frissora leaving voluntarily or is he being forced to go? Facts tell their own story. The conditions of his move speak for themselves.
On November 1, Frissora and Caesars entered into a separation agreement. Under the terms of the agreement, Frissora shall resign from the company’s board of directors and as an officer of the company and its subsidiaries on February 8, 2019, and such termination will be treated as a termination of Frissora’s employment without cause for all purposes.
According to the Push-out Scoring System, 10 points are given when the manager was openly pushed out or when there is absolutely no doubt that the manager left the position due to pressure.
For the Push-out Score, it is irrelevant whether Frissora was forced to leave or saw himself forced to leave. The circumstantial evidence leaves no room for interpretation and clearly indicates that his departure was forced, and the Push-out Score is 10.