MGM Resorts International founder Kirk Kerkorian will leave the company’s board of directors when his current term expires in June, the casino operator announced Thursday.
Kerkorian, 93, who owns 27 percent of the company through his privately held Tracinda Corp., will become a senior adviser to the company and hold the title of first director emeritus.
An MGM Resorts statement said Kerkorian would have a standing invitation to board or executive committee meetings but would not have a vote.
“Throughout the years, I have relied on Kirk far beyond his role as our largest shareholder,” MGM Resorts Chairman and CEO Jim Murren said in a statement. “I look forward to continuing to receive the benefit of his counsel for many years to come.”
The traditionally media-shy Kerkorian, a Los Angeles-based billionaire and philanthropist, told Bloomberg News on Wednesday that he preferred a strategic and advisory role with the company.
He said his ownership stake would be represented by the MGM Resorts board, including Tracinda executives Dan Taylor and Anthony Mandekic, and Murren, with whom he speaks three or four times a week.
“I just didn’t care to keep going back to meetings,” Kerkorian said. “(The board meetings) got to be very lengthy. I do stay busy. I like new challenges.”
Kerkorian’s ownership stake in MGM Resorts shrank over the years, including in 2007 when Dubai World, the investment arm of the Persian Gulf emirate, acquired about 10 percent of the company. He controlled more than 50 percent of MGM Resorts in 2009, until a stock offering reduced his stake.
Last year, through Tracinda, Kerkorian participated in another MGM Resorts stock offering, cutting his stake by 32 million shares and earning Tracinda about $400 million.
In a January filing with the Securities and Exchange Commission, Kerkorian hinted that he might sell his remaining stake in the company.
Tracinda now owns about 131.2 million shares in MGM Resorts, which is traded on the New York Stock Exchange. The current value is more than $1.8 billion, but before the recession the holdings were worth as much as $15 billion.
Macquarie Securities gaming analyst Chad Beynon told investors he doubted that Kerkorian’s board departure signaled his divestiture in the near term.
“We don’t view this news in a negative light,” Beynon said. “Shares of MGM Resorts have been fairly volatile … during the last six months, primarily driven off of macroeconomic data rather than fundamental or operational improvements.”
Kerkorian’s news came a day after MGM Resorts said it would take controlling ownership in the MGM Grand Macau from its 50-50 joint-venture partner once an initial public offering moves forward on the Hong Kong Stock Exchange.
Despite holding just an outside director position with the company for more than a decade, Kerkorian has been the driving force behind MGM Resorts, including his support for development of the $8.5 billion CityCenter complex, which opened in December 2009.
Kerkorian founded MGM Resorts in 1993 when he built the 5,000-room MGM Grand Las Vegas.
He helped steer the company’s growth, engineering the $6.4 billion purchase of Mirage Resorts in 2000 and the $7.9 billion acquisition of the Mandalay Resort Group in 2005.
Through Tracinda — which is named for his daughters Tracy and Linda — Kerkorian has been a consummate deal maker since the 1940s, when he first visited Las Vegas as an airplane pilot. His initial gaming purchase was a stake in the Dunes in 1955, and he began buying Las Vegas real estate in the 1960s.
During his career, Kerkorian has owned Strip casinos and large stakes in airlines, automobile makers, oil companies and film studios. In 1999, Kerkorian was part of the Las Vegas Review-Journal’s “The First 100,” which chronicled 100 people who had major impacts on Las Vegas over the city’s first century.
Kerkorian built The International — now the Las Vegas Hilton — and the first MGM Grand — now Bally’s Las Vegas. For short times, Kerkorian also owned the Sands, Flamingo and Desert Inn Hotels. In 1989, he bought the troubled Marina Hotel and the adjacent Tropicana Country Club, which he transformed into the current MGM Grand.
In February Kerkorian transferred his $200 million charitable Lincy Foundation to the University of California, Los Angeles. The foundation was established in 1989 and has given more than $1.1 billion to schools, hospitals and Armenian charities, according to a UCLA statement.
“Kirk’s contributions to the growth and development of MGM Resorts are far too many to detail,” Murren said. “Of even greater impact, however, have been the contributions of his time, talent and treasure to so many throughout the Las Vegas community, across the United States and around the world.”
Contact reporter Howard Stutz at firstname.lastname@example.org or 702-477-3871.