Kirk KerkorianMonday, January 7, 2019
Kirk Kerkorian (b. June 6, 1917 - June 15, 2015) was an Armenian-American billionaire and president/CEO of the modern incarnation of MGM, which today is still a motion picture studio as well as a resort properties corporation. Kerkorian wholly owned 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 the "father of the megaresort".
Once the richest resident of Los Angeles, he may have also been the most private. He almost never gaves interviews. He did not use credit cards. He did not have an e-mail account. He did not board commercial flights. He did not shop in retail stores. He did not make speeches. He did not accept awards. Even when he was being magnanimous--his charitable foundation has dispensed more than $100 million--he never allowed anything to be named in his honor. He did however eat out 3 or 4 times a week and played tennis every weekend, often with Alex Yemenidjian.
Net Worth in 2007 (Forbes Magazine) = $15 billion. Dropped to $4.2 billion at the time of his passing.
Kerkor "Kirk" Kerkorian was born in 1917 in Fresno, California to Ahron and Lily, Armenian immigrants. He is the youngest of 4 children. "Our first language, although we were born here, was Armenian," Kerkorian recalls. "We didn't learn the English language until we hit the streets." His father, an illiterate immigrant whom everyone called Villa (as in Pancho) on account of his oversize mustache, had become a paper millionaire during the great San Joaquin Valley raisin boom of World War I. Then recession of 1920-21 struck, and auctioneers liquidated his holdings. The young Kerkorian, under the tutelage of his older brother, became a fairly skilled amateur boxer but in 1939, he decided to learn how to fly airplanes.
The Kerkorians headed south, joining Los Angeles' urban poor. They landed first in Lincoln Heights, then the fringes of Jefferson Park, sometimes moving every few months when money was short. Kirk grew into a street-smart ruffian; he was expelled from Foshay Junior High for fighting, then sent to Jacob Riis, a downtown school for delinquent boys, before dropping out in the eighth grade. To help his parents Kirk began assembling a hustler's resume paperboy, golf caddie, steam cleaner, car refurbisher, furnace installer, amateur boxer (under the tutelage of his older brother Nish, also a boxer; Kirks nickname: "Rifle Right Kerkorian"), bouncer in a bowling alley bar. When he was 17 he lied about his age and joined the Civilian Conservation Corps, which sent him to cut fire trails in Sequoia National Park. During his boxing days, Kerkorian became the Pacific amateur welterweight champion.
When he was 25 he lied about his education and entered the Morton Air Academy in Blythe, where he earned the rank of lieutenant and became an army flight instructor. During World War II Kirk flew daredevil missions across the Atlantic for the Royal Air Force, delivering unarmed Canadian bombers to European bases for $1,000 a trip - trips many called suicide runs. After the war he became a soldier of fortune, scouring the globe for surplus planes, some of them less airworthy than others, and transporting them himself to the highest bidder.
In 1947, at the age of 30, he sank everything into Los Angeles Air Service, a small charter business that cost him $60,000. Californians were just awakening to the allure of Las Vegas, and Kirk hit it big by, shuttling celebrities, high rollers, elopers, and the occasional mobster to the 24-hour wedding chapels and casinos. He renamed the company Trans International Airlines, turning it into the first U.S. charter service with its own jet. He took it public in 1965. Armenian-Americans knew of Kerkorian and bought his stock. It rose from a low of $9.75 to a high of $32. "It brought the stock up to begin with, and then our earnings were great, too, and it kept going up until we sold to TransAmerica," says Kerkorian. In 1968 he sold out to the TransAmerica Corporation. In that 1968 deal, Kerkorian received about $85 million worth of stock in the TransAmerica conglomerate, making him its biggest shareholder.
In 1992 Kerkorian started MGM Grand Air, a super luxury airline that only flew LA-NY flights. Timing was bad as the extended recession caused the close of this airline in 1994.
Kerkorian and Las Vegas
- 1945 made his first visit to Las Vegas as a Cessna pilot.
- 1962 Kerkorian pulled off what Fortune magazine called "one of the most successful land speculations in Las Vegas' history." He bought 80 acres (320,000 sq m) across the Strip from the Flamingo for $960,000. The property was actually seperated from the Strip however by a narrow band of land belonging to another owner. "It was landlocked," says Kerkorian, "We traded the owners four or five acres for all of this thin strip that they could never build on." Caesars Palace contacted Kerkorian and rented it.
- 1967 bought 82 acres (330,000 sq m) of land on Paradise Road in Las Vegas for $5 million and built the International Hotel, which at the time was the largest hotel in the world.
- 1968 Sold Ceasars Palace land, having made $9 million on it in rent and sale price gains.
- 1969 Kerkorian's International Leisure also bought the Flamingo Hotel in order to train the staff of the soon to open International - poaching much of the management (33 people) from the Sahara.
- 1969 Built the worlds largest hotel at the time, the International (now the Las Vegas Hilton), which was 30 stories and 1,512 rooms. It was criticized before opening for being off the Strip. Kerkorian sold his Las Vegas home, his private plane and his yacht in order to build the hotel. "We opened that hotel with Barbra Streisand in the main showroom," says Kerkorian. "The rock musical 'Hair' was in the other showroom and the opening lounge act was Ike and Tina Turner. Elvis followed Barbra in the main showroom. I don't know of any hotel that went that big on entertainment."
- 1970-71 Sells two Las Vegas hotels to Hilton Hotels.
- 1973 (July 5) having purchased MGM, the famous movie studio, Kerkorian and MGM opened the original MGM Grand Hotel, which was the largest hotel in the world at that time (now that hotel is the Bally's). The new $107 million megaresort was named for a 1932 MGM film, "Grand Hotel." At 26 stories, the MGM Grand had 2,084 rooms, a 1,200-seat showroom and amenities like a shopping arcade, movie theater and jai alai fronton.
- 1980 November 11 the original MGM Grand burned in a fire that was the worst disaster ever in Las Vegas history, killing 85 people. MGM Grand reopened after only 8 months.
- 1986 Kerkorian sold the MGM Grand hotels in Las Vegas and Reno for $594 million to Bally.
- 1987 Agrees to buy the venerable Desert Inn and Sands hotels on the Las Vegas Strip from Summa Corp.
- 1993 Built the present MGM Grand Hotel, which has 5,000 rooms, eight restaurants, a health club, a monorail, the 15,000-seat MGM Grand Garden and a theme park as big as Disneyland when it opened in 1955. It was also the largest hotel in the world when it opened.
- 2000 MGM Grand buys Mirage Resorts for $4.4 billion.
- 2004 MGM Mirage announces it will buy Mandalay Resort Group, dramatically increasing Kerkorian's investment on the Las Vegas Strip.
- 2007 Kerkorian offers to take about $12 billion of MGM Mirage's assets private with his privately held Tracinda Corporation. Analysts think this could be the first step in a complete buyout.
- 2008 (December) - MGM Mirage to sell Treasure Island for $500 million
Spun off from Metro-Goldwyn-Mayer, MGM Mirage owns and operates many properties, including the Bellagio, MGM Grand, the Mirage, Excalibur, Luxor, Mandalay Bay, Treasure Island, New York-New York, CityCenter and the Boardwalk in Las Vegas, as well as the Beau Rivage Casino in Biloxi, Mississippi.
(see Business Week - November 2, 1974 for how he financed all of this)
In 1969, Kerkorian began buying MGM stock and by the end of the year had working control of the company. He immediately appointed James T. Aubrey, Jr. MGM's president. He downsized the struggling MGM and sold off massive amounts of historical memorabilia, including Dorothy's ruby slippers (from The Wizard of Oz), and several acres of MGM's backlots (which were razed to build houses). 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 exactly 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, which was later acquired by Warner Bros.; in 1990, the lot was sold to Columbia 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.
Longtime romance with MGM movie studio now over: 3-time studio owner closed $5 billion deal with Sony, 3 private-equity firms and cable giant Comcast in April, 2005; netted $1.8 billion.
- 1942 Married Hilda Schmidt, a Nebraska-born dentist's secretary whom he had met in his old southwest Los Angeles neighborhood.
- 1952 Divorced. No children. (She got their house in Inglewood, a two-year-old Ford, and $50,000.)
- 1954 Married Jean Maree Hardy, a Vegas showgirl at the Thunderbird Hotel. Two children, Tracy, and later adopted Linda.
- 1983 Divorced (private settlement believed to be worth $200 million). She remarried, but when she divorced in 1997 she sought nothing from her second husband. Her only request was that the court restore her name, Jean Kerkorian.
- 1991 Meets tennis pro Lisa Bonder and they enter long relationship.
- 1998 Kira Rose Kerkorian born to Lisa Bonder. Kirk voluntarily begins paying $20,000 a month in child support, later raising the amount to $50,000 a month. In a massively public court case, Lisa petitions to raise the monthly child support from $50,000 a month to $320,000 a month. Father later determined to be Steve Bing, who is also the father of Elizabeth Hurley's child. A breach of privacy suit was filed against Kerkorian by Bing.
- 1999 Kerkorian married tennis pro Lisa Bonder for the prearranged period of 30 days, because Lisa wanted to "legitimize" Kira.
- 2007 August 8, Kerkorian (who has joint legal custody of Kira) filed papers in Superior Court to lift a restraining order obtained by his ex-wife Lisa Bonder that prevents Kira from seeing Hollywood producer Stephen Bing (biological father).
Kerkorian and Armenia
Kerkorian’s benevolent activities in Armenia began after a catastrophic 1988 earthquake that devastated northern regions of what was then a Soviet republic. He provided medical and other suppliers to survivors of the calamity that killed some 25,000 people.
Through his Lincy Foundation charity, Kerkorian went on to cover half of the cost of an 80-kilometer highway connecting Armenia to Karabakh. The mountainous road was completed in 1998 four years after a Russian-mediated truce stopped a bloody Armenian-Azerbaijani war for the disputed territory. It has since served as Karabakh’s main transport link to the outside world.
Kerkorian visited Armenia for the first time later in 1998. Over the next decade Lincy financed more than $200 million worth of infrastructure projects in his ancestral homeland, making Kerkorian its number one Diaspora benefactor.
Roughly $150 million of that money was spent between 2001 and 2004. It was mainly channeled into the repair and construction of 430 kilometers of major highways, bridges, tunnels as well as 3,700 new homes in the Armenian regions still reeling from the 1988 earthquake. Lincy’s funds were also used for the renovation of dozens of Armenian museums, theaters and concert halls.
The lavish aid led then President Robert Kocharian to give Kerkorian Armenia’s highest state award: the Order of Fatherland carrying the title of “national hero.” The media-shy tycoon received it during his second and last visit to the country in May 2005.
Kerkorian used that trip to inspect roads in and outside Yerevan that were refurbished with his money. “I just couldn’t imagine how beautiful this place is,” he told a reporter while sitting in a street café in the Armenian capital.
Two months later, Kerkorian contributed another $60 million to the reconstruction of rundown schools and more highways and streets in Yerevan.
Kerkorian shut down Lincy and transferred its assets to the UCLA university in California in 2011. The university set up a special fund to support Armenian schools and other education programs of the Armenian-American community.
Kerkorian’s last Armenian-related project was his reported decision to fund a film about the 1915 Armenian genocide in Ottoman Turkey. Showbiz411.com, an American entertainment industry news website, reported details of the upcoming movie on Monday, just hours before the tycoon passed away. “This could be a big epic hit,” it wrote.
Named after his two daughters, Kerkorian's Lincy Foundation has made huge charitable contributions, much of this to Armenian causes. Kerkorian has donated about $180 million to Armenia through his charity, the Lincy Foundation. The bulk of the money has been allocated and spent since 2001 on various infrastructure projects. Those included the repair of 420 kilometers of major highways and the construction of 3,700 new apartments in the country’s northwestern regions hit hard by the 1988 catastrophic earthquake. In May, 2005, President Kocharian awarded Kerkorian Armenia's highest honor, the Medal of Fatherland, which carries the title of “national hero” of Armenia.
Casino mogul Kirk Kerkorian donates $100 million to UCLA The university will be able to use Kirk Kerkorian's $100-million gift for medical research, scholarships and other projects. University officials will also be able to administer another $100 million for other charitable causes.
A foundation established by billionaire investor and Las Vegas casino mogul Kirk Kerkorian is giving $100 million to UCLA for medical research, scholarships and other projects and will allow the university to administer an additional $100 million for charitable causes around the country, officials announced Monday.
Under terms of the agreement announced Monday, the $200 million in assets of Kerkorian's Lincy Foundation will be transferred to a new organization called the Dream Fund, which will be based at UCLA. The Westwood campus will be able to use half the total for its own research and student support without any specific requirements, a flexibility especially welcome during the UC system's current budget crisis, administrators said.
Kerkorian, 93, a prominent Armenian American, founded the Lincy Foundation (named for his daughters Linda and Tracy) to aid victims of the devastating 1988 earthquake in Armenia. Since then, the Beverly Hills-based foundation has broadened its focus and given more than $1 billion to benefit education, scientific and anti-poverty efforts around the world, in addition to aiding Armenian charities, according to its president, Jay Rakow. Last week, it gave $10.5 million to the Glendale-based United Armenian Fund, to help reconstruct schools in Armenia's quake zone.
Asked why UCLA was chosen as the beneficiary, Rakow said the foundation has given the campus about $70 million in previous gifts and has been pleased with the way the money was used. "Mr. Kerkorian has tremendous confidence in their ability to use these funds in a responsible and productive way for the types of charitable purposes that the Lincy Foundation has always pursued," Rakow said Monday.
The Lincy Foundation will close after government authorities approve the assets' transfer, he said.
Patricia Glaser, an attorney and spokeswoman for Kerkorian, said the businessman would not comment on his donations. "He would prefer not to. It's not his style," she said.
Kerkorian is the largest stockholder of MGM Resorts International, a firm that owns Las Vegas' MGM Grand Resort, the Mirage and the Bellagio hotels, among other properties. Kerkorian has been a key player and controversial figure in Hollywood, purchasing and later selling MGM Studios and United Artists. He also has made major investments in the U.S. auto industry.
Typically shy of publicity, Kerkorian was in the spotlight three years ago when he testified at the trial of Hollywood private eye Anthony Pellicano. The investor denied any knowledge of the illegal wiretapping that Pellicano later was convicted of using against Kerkorian's former wife during a child-support battle.
The Kerkorian gift is tied with last month's gift from Luskin and his wife, Renee, as the second largest ever to UCLA. They are topped only by entertainment industry mogul David Geffen's $200-million donation to UCLA's medical school in 2002.
In a statement of thanks released Monday, UCLA Chancellor Gene Block described the Kerkorian and Lincy Foundation gift as "a magnificent act of support." Coming so soon after the Luskin gift, he said, the Lincy transfer "is yet another testament to our community's enduring belief in UCLA's important role as an engine for the public good."
Rhea Turteltaub, UCLA's vice chancellor for external affairs, described the Lincy donation "as a wonderful Valentine's gift". She said a small advisory board would be established to make decisions about the new Dream Fund's awards and said there were no restrictions other than that the grants should help solve social problems.