Thursday 27 October 2016

Obituary: Kirk Kerkorian Billionaire Vegas hotelier.

Born June 6, 1917; died June 15, 2015

Published 21/06/2015 | 02:30

Vegas tribute: The town he built remembered Kirk Kerkorian this week
Vegas tribute: The town he built remembered Kirk Kerkorian this week

Kirk Kerkorian, who has died aged 98, was a wheeler-dealing American entrepreneur who described himself as "a gambler at heart", and whose multibillion-dollar fortune was made by buying and selling airlines, film studios, stakes in America's major car makers and prime Las Vegas real estate.

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Kerkorian's high-risk corporate gambits always made headlines and caused tremors on Wall Street - but it is in the neon-lit fantasy-scape of Las Vegas, the gaming resort in the Nevada desert, that his true legacy is to be found.

He was a small airline operator - and a regular high-roller at Vegas's tables - when he made his first investment in the city in 1962 by buying 80 acres of the legendary 'Strip' for $960,000. It became the site of Caesars Palace, a giant Roman-themed casino and hotel complex which paid him $2 million a year rent until the hotel's owners bought him out at a handsome profit in 1968.

He went on to buy the Flamingo and other hotel-casinos - while at the same time wrestling control (from Seagram alcohol heir Edgar Bronfman) of the Hollywood studios of Metro-Goldwyn-Mayer, and announcing that MGM would henceforth diversify into Las Vegas property.

The 2,800-room MGM Grand - at the time, the world's largest hotel - opened in 1973, suffered a catastrophic fire in 1980, and was sold off (to Bally, a slot-machine manufacturer whose name it now bears) in 1986.

Kerkorian was much less engaged as a studio mogul than he was as a hotelier and dealmaker, and many of MGM's historic movie-related assets were also turned into cash; but in 1981, he expanded the original business by buying United Artists - before selling the whole group to the CNN television tycoon Ted Turner in 1986, and buying parts of it back from him.

MGM then passed through several hands before Kerkorian re-acquired it a decade later, only to sell it once more, to Sony, in 2005.

Back in Las Vegas, Kerkorian successfully bid in 2000 for Mirage Resorts - created by rival tycoon Stephen Wynn - to gain control of several of the city's most opulent resort properties, and more than half of its prime hotel rooms. MGM Mirage embarked on a new $8 billion development, but was stricken by the financial crisis, and forced in 2009 to raise new capital, which diluted Kerkorian's control. As he had observed many years earlier: "Sometimes you lose, but that's the nature of the game. There's always another game…"

Kerkor Kerkorian was born in Fresno, California, on June 6, 1917, to Armenian immigrant parents; originally farmers, they lost their land in the 1920s and made an uncertain living from fruit stalls in Los Angeles, moving home many times.

Kirk, as his name became, learned two lessons from his family's troubles: don't become too attached to anything you own, because it might be taken away from you; and never bet everything on a single roll of the dice.

He helped to bring in income from the age of nine, had little formal education, and was sent to reform school for punching a teacher's son - a foretaste of his short career as welterweight boxer "Rifle Right Kerkorian", winner of 29 of 33 fights.

He tried a variety of other occupations before training as a commercial pilot.

During the Second World War, he turned down a commission in the US Air Force, instead taking a well-paid job - "a hot ticket", as he called it - delivering Canadian-built de Havilland aircrafts for the RAF across the north Atlantic by the fastest but riskiest wind-assisted route to Scotland, and sometimes to India. He completed 33 such missions, saving enough money to buy his own aeroplane - and in due course, his own business, renamed Trans International Airlines - flying gamblers to Las Vegas in the post-war years.

He eventually sold his airline interests for more than $100 million profit.

Kerkorian later found an enthusiasm for investing in the motor industry that was fuelled by an encounter at a Florida racetrack with the Chrysler chairman Lee Iacocca -then an American folk hero for his rescue of the firm against Japanese competition.

Iacocca, in return, became an ardent fan of Kerkorian, who he said had "a sixth sense for sniffing out value… Doing deals is what keeps him alive."

Having bought 10pc of Chrysler in 1990, five years later, Kerkorian teamed up with Iacocca, by then retired and fiercely critical of his successors, to try to buy the other 90pc.

Their offer was rejected, but when Daimler-Benz bought Chrysler in 1998, Kerkorian reaped almost $5bn - tripling his original stake money.

At 88, Kerkorian surprised Wall Street in 2005 by picking up 10pc of the troubled General Motors, but the company was unwilling to listen to his advice, and he sold again. He returned three years later to acquire 6.5pc of Ford - but the company's stock plunged, losing him $600m in six months.

Kerkorian had a reputation for ruthlessness and impenetrability in his dealings - many investors profited with him over years, but minority shareholders found him uncomfortable as a partner. He shunned publicity, and was happy when his own casino staff failed to recognise him. At home in Los Angeles, he preferred the company of a coterie from his early days, who included the likes of Cary Grant and Frank Sinatra.

Though he never lost his appetite for profit, he eventually gave up gambling and claimed to find little satisfaction in being rich: "I don't like to get dressed up and go to see bankers."

After he was 50, he took up tennis and played competitively in old age, ranking 11th in national over-85 championships.

His fortune peaked in 2008 at an estimated $16bn, making him California's richest resident, but fell below $4bn after the financial crisis.

He gave away at least a billion, including $180m for Armenian earthquake relief and $200m to UCLA.

Kerkorian married first in 1942 to Hilda Schmidt. They were divorced in 1951 and he then married Jean Maree Hardy, an English choreographer working in Vegas. They had two daughters, but divorced in 1984.

He was married briefly for a third time in 1999 to Lisa Bonder, a former tennis professional 48 years his junior.

She later sued for the largest child-support award in Californian history, of $320,000 a month, but the child was proved by DNA testing not to be Kerkorian's.

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