ALWAYS A STEP AHEAD

At an age when his contemporaries either have retired, gone bust or passed on, billionaire financier Kirk Kerkorian is still refining the art of the deal.

The Los Angeles-based investor and majority shareholder in MGM Mirage quietly turned 90 Wednesday. The word retirement, however, continues to remain absent from his vocabulary.

Kerkorian has invested in and operated numerous industries, including airlines, carmakers and film studios. But since the end of World War II, no business has held his interest as much as gaming.

Since the early 1960s, Kerkorian has played a paramount role in shaping the landscape of the Strip and Las Vegas. His latest brushstroke was announcing last month that he wanted to acquire two of MGM Mirage’s prized possessions, Bellagio and CityCenter.

His closest confidants were not surprised by his latest announcement.

Kerkorian, they said, has an agile mind and a keen business acumen. Even as he approached 90, he never wavered from the way he negotiates transactions and strikes financial agreements. Friends and rivals say Kerkorian is like a seer, gazing 10 years to 20 years into the future when viewing how a potential investment opportunity could affect the gaming industry.

“He enjoys the business and he absolutely loves making the deal. That’s what drives him,” said retired casino executive Burton Cohen, 83, who has known Kerkorian for almost half a century and spent a good part of his career operating some of the businessman’s Las Vegas hotel-casinos.

“He is constantly surprising me,” Cohen said.

The traditionally media-shy Kerkorian declined recent interview requests.

He has granted interviews previously, however. He was profiled by the Los Angeles Times in 2005 and he sat for a lengthy discussion with the late K.J. Evans in 1999 for the Review-Journal’s “The First 100,” which chronicled 100 people who had major impacts on Las Vegas over the city’s first century.

In February 2005, Kerkorian attended gaming regulatory hearings for MGM Mirage’s buyout of the Mandalay Resort Group. He told the Review-Journal in a brief postmeeting interview that concerns about Las Vegas being overbuilt have been aired since the 1960s, but the city has always prospered.

“I always felt, going way back, that the future of Vegas was unlimited,” Kerkorian said. “In the last four years, Nevada has grown rapidly and there has been more interest worldwide. I have to believe the same thing will happen again.”

For this story, Kerkorian let others talk for him.

Senate Majority Leader Harry Reid, D-Nev., became acquainted with Kerkorian as a private-practice attorney representing the businessman’s brother in the 1960s and 1970s. Reid called Kerkorian a friend of 45 years.

The two men keep in touch, visit occasionally, and mostly discuss politics or boxing.

“Kirk is probably the most unassuming person in the world,” Reid said. “He’s a person driven by an innate ability to look into the future of the business world and capitalize on it.”

MGM Mirage Chairman and Chief Executive Officer Terry Lanni has spent 12 years fulfilling a role Cohen and the late Fred Benninger once held — the person directly in charge of Kerkorian’s gaming holdings. The relationship is far from being boss-subordinate.

“It’s great to be the CEO of his company because he is always looking toward the future,” Lanni said. “Kirk is a very humble person. I’ve seen a lot of people who own 2 percent of something who call it their company. Never once in my 12 years with Kirk have I heard him refer to MGM Mirage as ‘my company.’

“Whenever we propose something, he wants to know how it will affect the other shareholders. He has majority control, but he’s very cognizant of all the other shareholders.”

Las Vegas has fascinated Kerkorian for more than 60 years.

Publications and historians have cited Kerkorian as one of the central figures in helping Las Vegas grow into one of the world’s premier tourist destinations. Much of what Kerkorian accomplished was without fanfare.

“I don’t think he gets enough credit for being the originator of the megaresort, and frankly, I don’t think he cares one way or the other,” said Michael Green, a history professor at the Community College of Southern Nevada. “He’s a throwback to the days when the casino operators didn’t want personal publicity. Kirk Kerkorian has done a lot of things without being seen doing them.”

In the 1940s, Kerkorian operated a small airline that shuttled gamblers into then- remote Las Vegas from a Los Angeles-area airport.

Starting in the 1960s, Kerkorian bought and sold several of the Strip’s best-known resorts. He also sold the land on which Caesars Palace now stands. Three times he built and opened what were considered the world’s largest hotel-casinos.

Since 2000, Kerkorian has engineered two of the largest-ever casino industry multibillion-dollar buyouts on behalf of MGM Mirage.

“He loves the game, pure and simple, and he knows how to make money for himself and his stockholders,” said Michael Gaughan, owner of the South Point, former operator of Coast Resorts and a longtime Kerkorian friend. “Here’s a guy, 90 years old, looking to make deals 20 years out. He’s got the right idea. He’s in great health both physically and mentally.”

Last month, Kerkorian showed he can still set Las Vegas, the gaming industry and the financial community ablaze with speculation.

Through Tracinda Corp., his privately held Beverly Hills, Calif.-based investment arm, Kerkorian announced his intentions to buy Bellagio, considered one of the Strip’s ultraluxury resorts, and CityCenter, an under-construction $7.4 billion, 76-acre mixed-use project, from MGM Mirage.

No details, structure or schedules were given; analysts said it would be months before a transaction, if any, could be announced. Neither MGM Mirage nor Kerkorian will discuss the possibilities of a deal beyond the innocuous language of statements.

But even if he isn’t talking to reporters, Kerkorian is likely dealing.

“What gets his mojo working? It’s the deal. He loves the deal,” said Wynn Resorts Ltd. Chairman Steve Wynn, who negotiated the sale of Mirage Resorts to MGM with Kerkorian. “Kirk has always been a person who perceives a value and then jumps on it. If he has a perception that something is undervalued, he buys it. He’s the best I know of understanding the value of what something is worth.”

For Kerkorian, the impact in the Bellagio-CityCenter announcement was immediate.

His one-paragraph Securities and Exchange Commission filing caused shares of MGM Mirage to jump more than 27 percent in price in one day. Kerkorian’s own personal stake in the company, 158.8 million shares, grew to a value of between $12 billion and $13 billion.

Wall Street opinions on the news varied. Some analysts speculated Kerkorian desires to take MGM Mirage private. Others believe he thought the company’s stock price had been too low and he wanted to drive up the shares’ value. A handful of analysts suggested Kerkorian thinks MGM Mirage is too large and that he wants to sell off pieces of the 19-resort company.

Whatever his intentions, Kerkorian is pulling the gaming industry’s strings for a fifth straight decade.

Kerkorian has bought and sold a Las Vegas portfolio over his career that reads like a Strip historical document.

With his proceeds from the sale of the land that would become Caesars Palace, Kerkorian purchased 82 acres on Paradise Road in 1967. The site would eventually be the site for the International (now the Las Vegas Hilton), dubbed the world’s largest hotel-casino at the time with 1,512 rooms. Before that resort opened, Kerkorian decided to buy the Flamingo as a way to train the International’s staff. By the end of 1971, he had sold both properties to Hilton Hotels Corp.

Less than a year after the sale, Kerkorian, who had taken majority ownership of MGM Studios, decided to put the studio’s name on a new hotel-casino, the MGM Grand (now Bally’s Las Vegas), which opened in 1973 at a cost of $107 million. With 2,084 rooms, the MGM Grand surpassed the International as the world’s largest hotel-casino.

In 1986, he sold the MGM Grand and a sister resort in Reno to Bally Manufacturing of Chicago for $594 million. At the time, gaming analysts said it was the largest single hotel sale ever.

Kerkorian didn’t stay sidelined for long. In 1987, he bought both the Desert Inn and the Sands for $167 million from the Summa Corp., which was the legacy of the Howard Hughes casino empire. Summa was exiting the gaming industry.

A year later, Kerkorian sold the Sands to then trade-show magnate Sheldon Adelson for $110 million. (The Sands was eventually demolished and became the site of The Venetian).

In 1989, while remodeling the Desert Inn, Kerkorian announced he was acquiring the troubled Marina and the adjacent Tropicana Country Club. He said the 115 acres at the corner of Tropicana Boulevard and the Strip would be the site of the $700 million MGM Grand hotel and theme park, which would become, at the time, the world’s largest and most expensive hotel-casino.

Some 20 years after he built the International, Kerkorian was again transforming Las Vegas.

“He’s not one to toot his own horn,” Cohen said. “That’s not Kirk. I never knew what he was going to do until I read about it.”

Current Nevada Gaming Commissioner Art Marshall once owned a chain of clothing shops inside casinos. He always wanted to make sure he had a store in a Kerkorian-owned property.

“Kirk Kerkorian loves the challenge of doing business,” Marshall said. “But he is not a grandstander. He’s a quiet man who likes his privacy. I’m not surprised at all that he keeps doing what he’s doing.”

Green, the college history professor, humorously likened Kerkorian to Zelig and Forrest Gump, fictional literary and cinematic characters who miraculously pop up in world-changing events. Kerkorian appears to have played a role in many of Las Vegas’ historical moments.

“It seems like he’s been involved in everything that has gone on here,” Green said.

Kerkorian sold the Desert Inn while building the current MGM Grand to concentrate on the one resort. That didn’t last long.

In 1995, MGM Grand was a one-casino company with 7,000 employees, $700 million in annual revenues and market capitalization of $1.3 billion. Today, the company employs 65,000 workers, has annual revenues of $7.5 billion and a market capitalization of $23.4 billion.

Along the way, Kerkorian helped engineer the $6.4 billion buyout of Mirage Resorts in 2000 and the $7.9 billion purchase of the Mandalay Resort Group in 2005.

“He was involved in each transaction,” Lanni said. “He’s not a detail person, but he’s a big-picture person. Kirk has a keen financial mind and very good understanding of people. From my perception in dealing with him, he is a very focused person.”

As a businessman, Kerkorian has touched industries besides gaming.

He dabbled in airlines, once owning about 17 percent of now defunct Western Airlines in the 1970s. In 1991, he made a failed bid for Trans World Airlines.

Hollywood also held his interest. Three times, Kerkorian bought and sold the film studio MGM/United Artists. Three times, he made a profit.

The U.S. auto industry has also captivated Kerkorian.

In the 1990s, he bought a large chunk of the Chrysler Corp., but sold the stock after launching a failed hostile tender offer.

In 2005 and 2006, Kerkorian made moves on General Motors Corp., becoming the automaker’s largest shareholder before cashing out altogether last December. In April, Kerkorian made one last stab at Chrysler Corp., offering $4.5 billion. The bid failed.

Gaming, however, remains his passion.

“I think Kirk is a great role model on a number of levels,” Wynn said. “He is reserved but he has a very robust and active lifestyle and he learns and gains wisdom from life. He just plays it the way he sees it. He’s quite simplistic in his approach.”

ad-high_impact_4
Business
MGM Grand Plans To Add Retail And Dining To Its Strip Facade
MGM Grand President and Chief Operating Officer Scott Sibella said executives are “discussing redeveloping that entire frontage of the building out to the Las Vegas Strip.” (Todd Prince/Las Vegas Review-Journal)
Boyd Gaming planning new corporate campus
Casino operator Boyd Gaming Corp. has filed plans to build a new corporate campus. The plans call for two 10-story office buildings and a six-level parking garage in the southwest Las Vegas Valley. Boyd Gaming operates The Orleans, the Suncoast, downtown's California Hotel and other properties. The new headquarters would be just a mile from its current main office building.
Bellagio Conservatory transformed to celebrate Year of the Pig
The Bellagio Conservatory Team transformed the 14,000 square foot conservatory to commemorate Chinese New Year, the holiday that marks the end of the coldest days of winter. (Rachel Aston/Las Vegas Review-Journal)
CES 2019: Intro uses sound to connect people
Intro, a startup that is part of the Future Worlds Accelerator in the UK, has an app that uses ultrasonic sound to find people and companies nearby.
CES 2019 Video: CES wraps up another year
Time-lapse video of the action at CES 2019 in Las Vegas. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Create your own beauty products
Beauty Mix by BeautyByMe is a product that lets you create your own cosmetics and beauty products. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Picobrew’s home brew machine
Picobrew brings automation to homebrewing. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Surviving CES
What it's like to spend four days working the mammoth tech convention. (Jason Bracelin/Las Vegas Review-Journal)
Haier’s smart home
Haier presented smart home technology at CES 2019.
CES 2019 VIDEO: Foldimate makes laundry day easy
Foldimate has created a machine that will fold your laundry for you. Just feed it anything you need folded and it will do the rest. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Opte device corrects skin spots
Opte from Proctor and Gamble is a device for correcting spots and freckles from skin. It analyzes the area for spots and then covers them with a serum of matching skin tone. (Mat Luschek/Las Vegas Review-Journal)
Circa hotel-casino in downtown Las Vegas unveiled
Derek Stevens reveals Circa hotel-casino in downtown Las Vegas. He plans open by the end of 2020. (K.M Cannon/Las Vegas Review-Journal)
Circa, new casino coming to Fremont Street
Casino owner Derek Stevens announces his new property Circa, coming to Fremont Street in downtown Las Vegas in late 2020. (Michael Quine/Las Vegas Review-Journal)
Dreenk My Oeno makes wine suggestions
At CES 2019 in Las Vegas, the Dreenk My Oeno tells you all about wine.
Polaroid One Step Plus camera unveiled at CES 2019
Polaroid has moved into the digital age with its One Step Plus camera with Bluetooth. With the connected app, it turns your smartphone into a remote for the camera, along with filters and features.
Amazon is everywhere at CES 2019 in Las Vegas
Seemingly everything works with Amazon Alexa
LG Smart Mirror helps you dress snazzy
LG’s Smart Mirror is less of a mirror but more of an assistant to help get you looking snazzy. It takes your image and recommends clothes for you or matches existing clothes with new clothes, which can be purchased right from the mirror. (Mat Luschek/Las Vegas Review-Journal)
Underwater robots make waves at CES 2019 in Las Vegas
Robosea is a company dedicated to underwater robotics. They produce consumer robots for underwater filming as well as commercial products which can be used for underwater research. (Mat Luschek/Las Vegas Review-Journal)
CES 2019 - Victrola record players spin in Las Vegas
A new spin on an old favorite, Victrola record players are meeting a demand for retro products. The brand is also making furnitures with built-in speakers.
CES 2019: Slamtec robots ready to serve
Slamtec is a robotics company out of China whose goal is to provide solutions for laser localization mapping and navigation. They have created two autonomous robots that can be used in areas such as bars, restaurants and malls. (Mat Luschek/Las Vegas Review-Journal)
Mixologiq drink maker appears at CES 2019 in Las Vegas.
This is the Mixologiq drink maker.
CES 2019: Veritable smart garden
Let’s face it; not all of us have green thumbs. And herbs are particularly difficult to grow, considering their constant need for sunshine. Enter the Veritable smart garden from Exky, which does it all for you. (Heidi Knapp Rinella/Las Vegas Review-Journal)
Bonnie Springs Ranch near Las Vegas being sold to developer
Bonnie Springs Ranch near Las Vegas is being sold to a developer, set to close in March. Bonnie Springs, west of Las Vegas off State Route 159 — next to Spring Mountain Ranch State Park — spans more than 60 acres and was on the market for $31 million. The developer and his project partner are under contract to buy the ranch and plan to chop it up mostly into custom-home lots. The plans includes a 25-room motel, a restaurant and a 5,400-square-foot event barn.
Bone-conduction headphones form Aftershokz
Aftershokz offers bone-conduction headphones - headphones that don’t go in the ear.
CES Happy Hour party at Hangover Suite at Caesars Palace
Conventioneers mingled during the Hardware Massive CES 2019 Happy Hour Bash at The Hangover Suite at Caesars Palace in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Autonomous Cars and Futuristic Aircraft Rule CES
Day two of CES was dominated by autonomous cars and futuristic aircraft in the North Hall of the Las Vegas Convention Center.
TekNekSavr fights neck problems caused by smart phones
Atiya Syverson invented the TekNekSavr to help fight neck and head problems caused by strains while typing on smart phones. (Mat Luschek/Las Vegas Review-Journal)
New eyeglasses know if you fall and call for help
The French company Abeye has created eye glasses that will detect if the wearer falls and call for help. (Mat Luschek/Las Vegas Review-Journal)
Company that creates vibrator-like device claims genders bias against CES
Lora DiCarlo is a women-run start-up that creates a vibrator-like device designed for female pleasure called the Osé. This year they were awarded the CES Innovation Award in the Robotics and Drone Category, but a month later the Consumer Technology Association, which runs CES, rescinded the award and their booth. Haddock and her team believe it is a reflection of gender bias and sexism in an industry with a long history of male domination.
CES-Wagz has new pet products
Wagz has three new products to help create better lives for your pets in a digital world. One is a collar with LTE tracking and an HD camera. Also a smart pet door that only lets your pet in and out. Lastly, a device to humanely keep Fluffy out of certain areas of your home. (Mat Luschek/Las Vegas Review-Journal)
TOP NEWS
News Headlines
Home Front Page Footer Listing
Circular
You May Like

You May Like