offering to acquire the International site and reimburse him for all of his costs . But Kerkorian kept building . Early in 1968 , about six months after his 50th birthday , Kerkorian closed another massive transaction that made Hughes ’ s threats and bluster even less relevant . He sold Trans International again , this time outright to San Francisco-based Transamerica Corporation . For the first time in 20 years , the aviator was no longer in the aviation business . But he was still a gambler and on a roll , feeling the time was right to go for an even bigger score . His net worth swelled to $ 200 million .
Kerkorian placed the first in a series of bets on something he called “ the leisure industry .” His plan was to assemble a collection of resort , transportation and entertainment properties , a vision that would alter the landscapes of Las Vegas , Hollywood and Detroit .
With steel girders still going up on Paradise Road and Hughes still trying to run him out of Las Vegas , Kerkorian surprised Wall Street with a $ 67.5 million tender offer for the nation ’ s oldest commercial air carrier , Los Angeles-based Western Air Lines . Part of the attraction was economic . The regional gem of an airline was hoping to be awarded profitable new routes to Hawaii . Another attraction was personal . Kerkorian was having regrets — some might call them separation anxieties — since selling off his long-held charter airline .
However , on his way to becoming Western ’ s largest shareholder , Kerkorian also picked up another rival . The airline ’ s bombastic president , Terrell C . Drinkwater , and his handpicked board of directors greeted Kerkorian ’ s unexpected investment with suspicion that morphed quickly into hostility . Efforts to reassure them that Kerkorian supported management and planned no changes at the top failed to ease tensions . Drinkwater opposed any power sharing and worked to block Kerkorian ’ s influence with Western ’ s board .
Back in Las Vegas , Kerkorian ’ s other rival was trying a new tactic . Hughes had bought the unfinished and much more modest Landmark Hotel and Casino out of bankruptcy . It was , however , just across Paradise Road from the International . Hughes was going to bring competition to Kerkorian ’ s doorstep . The showdown on Paradise would feature dueling grand opening extravaganzas .
But Kerkorian relished competition , and Hughes was playing into his hands . The world ’ s biggest hotel would open with some of the world ’ s biggest stars . Hughes headlined with comedian Danny Thomas who drew a respectable crowd . Kerkorian opened with “ Funny Girl ” Barbra Streisand , followed immediately by Elvis Presley , smashing every box office record in Las Vegas history .
It marked the end of Hughes ’ s frustrated bid for supremacy . Kerkorian would be the last tiger standing in Las Vegas . He would go on to transform the gambling mecca , three times building the world ’ s biggest hotels . Hughes later complained to Maheu that Kerkorian was “ the first man I couldn ’ t buy or break .”
Within days of the International Hotel ’ s sensational opening — and while still sparring with Drinkwater over a place on the board of Western Air Lines — Kerkorian shoved another stack of chips into play with another tender offer . This time he was betting on Hollywood ’ s crown jewel , MGM studios .
In 1969 , the legendary movie company that had produced such classics at “ Gone
Kirk Kerkorian in the early- to mid-1950s .
With the Wind ” and “ The Wizard of Oz ” was neck-deep in red ink and sinking fast . It was losing $ 10 million a month with likely box office duds projected well into the next year .
But Kerkorian saw hidden value , even before the age of cable television , in MGM ’ s extensive film archives . The studio ’ s real estate holdings included a back lot looking obsolete as more filming was scheduled on location . And Kerkorian saw a potential dollar value even in the cache of the studio ’ s name , a trademark conveying images of class and glamour . He wanted to own what he called those “ three magic letters .”
Once again , however , he found himself locked in competition with a strong-willed rival , this time MGM ’ s newly-appointed CEO , Edgar M . Bronfman , Sr . The Canadian-born financier also ran US operations for his family ’ s Seagram ’ s liquor empire and was a major MGM investor . Bronfman and his MGM board had anticipated a possible bid from Hughes . But “ Kerkorian who ?” was their first reaction to this surprise tender offer .
Bronfman challenged Kerkorian in court and in the boardroom , forcing Kerkorian
Courtesy of Una Davis
24 FINANCIAL HISTORY | Summer 2018 | www . MoAF . org