Kirk Kerkorian
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| Kirk Kerkorian | |
| Born | June 6, 1917 Fresno, California, United States |
|---|---|
| Occupation | CEO of Tracinda Corporation |
Kerkor "Kirk" Kerkorian (born June 6, 1917) is an Armenian-American billionaire, and president/CEO of Tracinda Corporation, his private holding company based in Beverly Hills, California. Kerkorian is known as one of the important figures in shaping the city of Las Vegas, Nevada and, with architect Martin Stern, Jr. [1] the "father of the megaresort."
Kerkorian splits his time between his residences in Beverly Hills and Nevada.
One of the richest residents of Beverly Hills, he may also be the most private. He almost never gives interviews and seldom appears in public. Even though his charitable foundation has dispensed more than $200 million and a school,[2] he has never allowed anything to be named in his honor.
His net worth in 2008, according to Forbes Magazine, is $16.0 billion, making him the world's 41st richest person.[3]
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[edit] Biography
Kirk Kerkorian was born on June 6, 1917 in Fresno, California, to Armenian immigrant parents.[4] Dropping out of school in 8th grade, he became a fairly skilled amateur boxer under the tutelage of his older brother, fighting under the name "Rifle Right Kerkorian" to win the Pacific amateur welterweight champion.
[edit] Flying
In 1939, he met Ted O'Flaherty, for whom he installed wall furnaces that heated water. O'Flaherty was taking flying lessons, and having taken no interest Kerkorian took a guest seat one day and was converted on the views of the Californian coast.
On sensing the oncoming World War II, and not wanting to join the infantry, he learned to fly at the Happy Bottom Riding Club in the Mojave Desert - adjacent to the USAF's Muroc Field, now Edwards Air Force Base. In exchange for flying lessons from pioneer aviatrix Pancho Barnes, he agreed to milk and look after her cattle.
On gaining his commercial pilot's license in six months, Kerkorian learned that the British Royal Air Force was ferrying Canadian built de Havilland Mosquitos over the north Atlantic to Scotland. The Mosquito's fuel tank carried enough fuel for 1,400 miles (2,300 km), while the trip directly was 2,200 miles (3,500 km). Rather than take the safer route Montreal-Labrador-Greenland-Iceland-Scotland route (although, going further north could mean the wings icing and distorting, and the plane crashing); Kerkorian preferred the direct "Iceland Wave" route which blew the planes at jet-speed to Europe - but it wasn't constant, and could mean ditching. The fee was $1,000 per flight, but the statistics were that only one in four completed the journey.[5] In May 1944, Kerkorian and his Wing Commander J.D. Woolridge rode the wave and broke the old crossing record. Woolridge got to Scotland in six hours, 46 minutes; Kerkorian, in seven hours, nine minutes. In two and a half years, Kerkorian delivered 33 planes, logged thousands of hours, traveled to four continents and flew his first four-engine plane.
After the war, having saved most of his wages, Kerkorian spent $5,000 on a Cessna. He worked as a general aviation pilot, and made his first visit to Las Vegas in 1944. After spending much time in Las Vegas during the 1940s, Kerkorian quit gambling and in 1947 paid $60,000 for Trans International Airlines, which was a small air-charter service which flew gamblers from Los Angeles to Las Vegas. He then bid on some war surplus bombers, using money on loan from the Seagrams family. Gasoline, and especially airplane fuel, was in short supply at the time, so he sold the fuel from the planes' tanks, paid off his loan - and still had the airplanes. He operated the airline until 1968 when he sold it for $104 million to the Transamerica Corporation.[6]
[edit] Kerkorian and Las Vegas
Kerkorian made his first visit to Las Vegas in 1944 as a Cessna pilot. In 1962, Kerkorian bought 80 acres (32.3 hectares) in Las Vegas, across The Strip from the Flamingo, for $960,000. This purchase led to the building of Caesars Palace, which rented the land from Kerkorian; the rent and eventual sale of the land to Caesars in 1968 made Kerkorian $9 million.
In 1967, he bought 82 acres (33 hectares) of land on Paradise Road in Las Vegas for $5 million and, with architect Martin Stern, Jr.,[7] built the International Hotel, which at the time was the largest hotel in the world; The first two performers to appear at the hotel's enormous Showroom Internationale were Barbra Streisand and Elvis Presley. Presley brought in some 4,200 customers (and potential gamblers), every day, for 30 days straight, breaking in the process all attendance records in the city's history. Kerkorian's International Leisure also bought the Flamingo Hotel (which later sold the Flamingo to the Hilton Hotels Corporation in 1970). The International Hotel is known today as the Las Vegas Hilton. Until about 2000, the Flamingo was known as the Flamingo Hilton.
In 1973 he purchased MGM, the famous movie studio. Again with architect Martin Stern Jr., Kerkorian and MGM opened the original MGM Grand Hotel and Casino, larger than the Empire State Building[8] and the largest hotel in the world at the time it was finished. On November 21, 1980, the original MGM Grand burned in a fire that was one of the worst disasters in Las Vegas history. The Las Vegas Fire Department reported 84 deaths in the fire; there were 87 deaths total, including three which occurred later as a result of injuries sustained in the fire. Amazingly, the MGM Grand reopened after only 8 months. Almost three months after the MGM fire, the Las Vegas Hilton caught fire, killing eight people.
In 1986, Kerkorian sold the MGM Grand hotels in Las Vegas and Reno for $594 million to Bally. Spun off from Metro-Goldwyn-Mayer, MGM Mirage owns and operates several properties, including the Bellagio, the current MGM Grand resort complex (where the Marina Hotel once stood), The Mirage, Treasure Island, the New York-New York, and what was once the Boardwalk in Las Vegas. They also own the Beau Rivage Casino in Biloxi, Mississippi.
[edit] MGM
In 1969, Kerkorian appointed James T. Aubrey, Jr. as president of MGM. Aubrey downsized the struggling MGM and sold off massive amounts of historical memorabilia, including Dorothy's ruby slippers (from The Wizard of Oz). Kerkorian sold MGM's distribution system in 1973, and gradually distanced himself from the daily operation of the studio. In 1979, Kerkorian issued a statement claiming that MGM was now primarily a hotel company; however, he also managed to expand the overall film library and production system with the purchase of United Artists in 1981. In 1986 he sold the studios to Ted Turner.
Turner kept ownership of the combined MGM/UA for 74 days. Both studios had huge debts and Turner simply could not afford to keep them under those circumstances; to recoup his investment, he sold all of United Artists and the MGM trademark back to Kerkorian. The studio lot was sold to Lorimar-Telepictures, which was later acquired by Warner Bros.; in 1990, the lot was sold to Sony Corporation's Columbia TriStar Pictures in exchange for the half of Warner's lot they'd rented since the 1970s. Also in 1990, the MGM studio was purchased by Italian financier Giancarlo Parretti, but Parretti defaulted on the loans he'd used to buy the studio and sold the studio back to Kerkorian in 1996.
In 2005 Kerkorian sold MGM once more to a consortium led by Sony. He retains a 55% stake in MGM Mirage.
On 22 November 2006 Kerkorian's Tracinda investment corporation offered to buy 15 million shares of MGM Mirage to increase his stake in the gambling giant to 61.7% from 56.3%, if approved.[9]
[edit] General Motors
Kerkorian once held 9.9 percent of G.M. shares. According to press accounts from June 30, 2006, Kerkorian has suggested that Renault acquire a 20 percent stake in GM to rescue GM from itself. A private letter sent to Rick Wagoner was released to the public to add pressure upon the General Motors executive hierarchy. Those talks have since failed.[10]
On Wednesday November 22, 2006 Kerkorian sold 14 million shares of his GM stake. It is speculated that this action was due to GM's rejection of Renault and Nissan's bids for stakes in the company as both of these bids were strongly supported by Kirk. The sale resulted in GM share prices falling 4.1% from its Monday 20 November price. The sale lowered Kerkorian's holding to approx. 7.4% of GM. On November 30, 2006 Tracinda Corp. investment firm said it had agreed to sell another 14 million shares of General Motors Corp., cutting Kerkorian's stake in the automaker to half of what he owned earlier that year. Later on he sold all but 5% the remaining shares of GM.[11]
[edit] Daimler-Chrysler
On April 5, 2007 Kirk Kerkorian made a $4.58 billion bid for the Chrysler Group, the U.S. arm of Daimler-Chrysler. Since Daimler-Chrysler announced they were interested in selling the Chrysler division on February 14, large investors such as Cerberus Capital Management, The Blackstone Group and Magna International each announced intentions to bid on the company. Kerkorian's bid, while not expected, is not surprising given his long involvement in the U.S. automobile industry. During the bidding process, he will be aided by his close associate Jerome York who was a former CFO at both Chrysler and IBM. As of May 14, 2007 80% of the Chrysler arm of Daimler-Chrysler was sold to Cerberus for $7.4 billion.
[edit] Personal life
Married three times, Kerkorian met his second wife Jean Maree Hardy, a former dancer at the Thunderbird, in Las Vegas. The marriage produced Kerkorian's two daughters, Tracy and Linda and three grandchildren. Kerkorian's personal holding company - Tracinda Corp - is a portmanteau of the two daughters names. Also named after his two daughters, Kerkorian's Lincy Foundation has made huge charitable contributions, much of this to Armenian causes.
Kerkorian's third marriage was to professional tennis player Lisa Bonder, 48 years his junior, which under a prenuptial agreement lasted for one month in 1999. He subsequently was involved in a breach of privacy suit filed against him by Steve Bing. Kerkorian claimed Bing was the father of Bonder's daughter, which was later established by DNA testing. On August 10, 2006, the Los Angeles Times reported that Kerkorian's attorneys were being sued by Bonder because of their connection to former high-profile private investigator Anthony Pellicano, who presently faces a 110-count federal indictment for racketeering, wiretapping, witness tampering, and other charges. Bonder's attorney alleges that Kerkorian's lawyers hired Pellicano to wiretap telephone calls illegally between him and Kerkorian's ex-wife in order to gain a tactical advantage in the divorce proceedings.[12]
Kerkorian often plays tennis with Alex Yemenidjian. He has a penchant for expensive clothes (especially custom-made outfits by Italian designer Brioni), but drives relatively low cost vehicles such as a Pontiac Firebird, Jeep Grand Cherokee and a Ford Taurus.[13]
[edit] References
- ^ "The Hidden History of the Xanadu" (html). University of Nevada, Las Vegas Center for Gaming Research.
- ^ [ www.armenialiberty.org ] Friday 20, May 2005
- ^ Bill Gates America's richest for 14th year in a row | Entertainment | People | Reuters
- ^ Los Angeles Business Journal Lists Richest Angelenos
- ^ Torgerson, Dial "Kerkorian, An American Success Story" biography pub 1974
- ^ The article requested can not be found! Please refresh your browser or go back. (C4,20060701,BUSINESS01,607010345,AR)
- ^ Water Resources: Special Collections
- ^ Tony Illia. "Nevada Swings Into the Seventies" (html). Southwest Contractor.
- ^ Update - Kerkorian Sells GM, Buys MGM - Forbes.com
- ^ G.M. Ends Talks With Renault and Nissan - New York Times
- ^ Kerkorian sells another 14 million GM shares at discount - Nov. 30, 2006
- ^ [1][dead link]
- ^ http://www.latimes.com/classified/automotive/news/la-fi-chrysler6apr06,0,5539938.story?coll=la-classifieds-autos-news
- Vlasic, Bill and Bradley A Stertz (2000). Taken for a Ride: How Daimler-Benz Drove off with Chrysler. William Morrow & Company. ISBN 0688173055.
- Kirk Kerkorian article, includes MGM fire information
- Kerkorian article discusses reduction in GM shares
- Kirk Kerkorian article at Armeniapedia.org
- 2006 Nov 30 Kerkorian GM stock sale
