Kerkorian Is Offering Stock in New Airline; Casino a Possibility
Kirk Kerkorian plans to make a public offering of shares in a new company that is launching a luxury airline and may also enter the casino business.
The prospective return of Kerkorian to the public stock market, scene of some of his triumphs, was confirmed without details Tuesday by Terry Christensen, who was named president of Kerkorian’s private holding company, Tracinda Corp. The press release also disclosed that Tracinda’s headquarters have been moved to Beverly Hills from Las Vegas.
In response to questions, Christensen disclosed that newly formed MGM Grand Inc. has already filed a preliminary prospectus to offer stock-buying rights to former shareholders of MGM Grand Hotels, which was sold to Bally Manufacturing last year. Kerkorian would be entitled to buy stock rights in an amount equal to his stake in the old company, or about 70%.
In return for keeping rights to the MGM Grand name after selling to Bally, Kerkorian agreed not to open a casino for two years.
As the expiration of that agreement gets closer, Kerkorian has been a frequent subject of Las Vegas reports that he has been studying the casinos there, including the troubled Dunes. There has even been speculation that he might be interested in buying back the Grand hotel-casino from Bally.
Kerkorian has demonstrated considerable prowess in making money through the stock market on companies he controls, including those he has split in two, sold and repurchased.
He engineered a series of coups in the last decade, first splitting the old Metro-Goldwyn-Mayer into two publicly traded firms, a film entity and a casino entity, and then acquiring United Artists.
Last year, the financier sold MGM/UA Entertainment and its Culver City studio to broadcaster Ted Turner while simultaneously buying back UA. Shortly afterward, he bought back MGM’s name and film distribution business from Turner and formed MGM/UA Communications to continue in the movie business.
MGM Grand Air is a subsidiary of MGM Grand Inc., and an offering of its stock could have as a lure the possibility of a new casino business in addition to the airline.
Christensen, who has served Kerkorian as lawyer and consultant in recent years, said that in his new post he will run Tracinda on a day-to-day basis, reporting to Kerkorian. Tracinda’s holdings include MGM/UA and MGM Grand.
Asked if a return to casinos is in Kerkorian’s future, Christensen would only say, “I wouldn’t rule that out.”
Staff Writer Denise Gellene contributed to this story.
