Two Way Hard Three | Las Vegas Casino & Design Blog

April 14, 2011

Citizen Kirk

Posted by Hunter

It's the end of an era... sort of.

MGM Resorts International founder and primary shareholder is stepping down from it's board of directors in June.

Kerkorian built the largest hotel in Las Vegas three times with The International, the original MGM Grand and then the MGM Grand we know today. Inextricably linked with Las Vegas, his fortunes have risen and fallen with Southern Nevada's.

What does this mean for MGM and Las Vegas? Probably not a whole lot will change. While it seems clear Kerkorian has served as an advisor to Murren and Lanni before him, it doesn't sound like that advisory relationship will change much, at least in the near term. If MGM executives could convince the board to go ahead with CityCenter, they're pretty much being allowed to do whatever they want over there anyway.


Read archived comments (4 so far)
April 14, 2011 9:38 AM Posted by detroit1051

Like a double dip ice cream cone, it's sweet to get both Hunter's and Dr. Dave's posts on Captain Kirk. It shows how important he has been to gaming and Nevada. I only saw him once, from a distance, at MGM Grand in 1994. He was in the coffee shop, which I understand was his style of dining. Modest, unassuming and a brilliant mind. He'll be 94 in June, and I'm sure it's totally his decision to leave now while he is still in prime mental and physical health. He clearly knows time waits for no one.
It's still not clear to me why he tried to enter, without success, the auto industry. I wonder whether his trusted advisor, the late Jerry York, steered Kirk wrong.

Where is MGM's Annual Meeting in June? I hope the publicity-shy Kirk Kerkorian will be present to receive his deserved recognition as Director Emeritus.

April 14, 2011 10:24 AM Posted by Jeff Simpson

After making a play to buy even more shares in (then) MGM Mirage just a few years ago, possibly as a prelude to taking the company public, things changed rapidly for Kirk Kerkorian.
The recession, CityCenter's troubles (imploding condo market, strapped Dubai World partner, Harmon catastrophe), Terry Lanni's resignation and -- I'm betting -- KK's advancing age, likely fueled his decision to begin liquidating his financial position in MGM and reduce his business activity.
Kerkorian had expertise in several industries (aviation, automotive and movies as well as casino resorts) and was always willing to buy and sell strategically. Several of his more recent decisions (Ford Motor investment, building condos at CityCenter, and concentrating MGM investment in Las Vegas) haven't done well andhis net worth plummeted.
In the gaming industry he will be best known (at least, as of now) for building big, four times building what were at the time the biggest and/or most expensive casino resorts: International, MGM Grand LV #1, MGM Grand LV #2 and CityCenter. He also was, along with Harrah's/Caesars, the biggest mover in the consolidation of the American casino industry, with two of the biggest deals: The purchases of Mirage Resorts and Mandalay Resort Group (which made MGM Resorts the state's and city's largest operator, employer and taxpayer).
Steve Wynn never names Kerkorian (or Sheldon Adelson, the other likely target of the barb) as the object of his oft-repeated maxim that "Bigger isn't better. Better is better," but the remark certainly applies to the big way Kerkorian operated in the industry.
I met Kerkorian only once, a brief interview at the time of his 2000 takeover of Mirage, and Kerkorian told me then that he was buying Wynn's company because of the quality of its properties. Kerkorian since that time has had executives (Lanni and Jim Murren) who have tried to build, acquire and operate both bigger and better, with mixed results.
Kerkorian's decision to step down from active membership on the MGM board is, I think, I wise one. He'll maintain his influence with Murren as the leading shareholder and savvy industry veteran while reducing his mandatory activity.
Although Kerkorian was battered by the Great Recession (as were many other Las Vegas owners and execs) I still have great admiration for the man and for his tremendous contributions to and his influence on the industry and Las Vegas. He certainly is one of the top few industry titans and deserving of much respect.

April 14, 2011 1:29 PM Posted by mike_ch

What's amazing is that Kerkorian has been around for so many years but at the end he overreached himself. His rock-solid patience was somehow broken by the insane overvaluation Las Vegas was holding five years ago, and his attempts to raise the profile of the company by focusing entirely on acquiring others' Vegas assets (and casting off anything else they held) while making private offers for Bellagio resulted in the company attracting the interest of Dubai's investment machine. We all saw where that went. It's like getting a haircut and your nicest clothes and going out to the clubs to find a date, to discover that the only people who talk to you are the working ladies at the bar.

Yes, Kirk's old, but it's just as likely that he's ceding control to enter his twilight as it is that he's unhappy with his control being limited in a company where his dominance of shares isn't what it used to be.

I will miss him, though, because he was the last of the mystery men of the Strip. The whole upper crust identity politics thing launched in the casino biz by Steve Wynn and Donald Trump means the industry will rarely again see someone with so much money who is such a shadowy and hard to recognize figure. Seeing Steve in his own hotel is practically a special attraction in and of itself nowadays, whereas Kerkorian turned down photos and preferred to visit completely unrecognized.

His departure pretty much severs the last link to the city's glamour era. He brought a trustworthy businessman's acumen to a town awash in Hughes' eccentricities, Stupak's hucksterism, and a boatload of "individuals of interest." It's almost a bit appropriate that Kirk disappears, as the company that for so long had been fiscally restrained and kept it's nose clean through the 70s is associated with overspending and is having to defend a partnership by necessity with Pansy Ho.

April 14, 2011 1:42 PM Posted by Romaman

After all these years since the Mirage opened, I still believe that if built at the right time, the original MGM Grand or the International could have been the casinos that revolutionized Las Vegas if the Mirage was never built.

Think about it...