January
4Return Performance?
Does Kirk Kerkorian still want to play with Leo the Lion?It was precisely forty years ago that Kirk surprised Hollywood by grasping control of fabled MGM. So some are asking, isn’t it time for a reprise?
Back in 1969 the one-time Armenian farm boy was on a roll. He’d parlayed ownership in a charter airline into a $73 million buyout of Western Airlines. Then he scooped up the Flamingo Hotel in Las Vegas.
His advisers at the time loved these moves, but were scared by his next scheme -- a buyout of MGM: The studio’s debt had spiraled to $85 million and it was about to default on its bank loans. Other Hollywood studios at the time also were in the red -- they were making lousy movies and TV had stolen their audience.
But Kirk was not one to listen to advisers. He had no Harvard MBA. When making a deal he would scrawl numbers on the back of an envelope.
So Kirk went ahead despite the advice and MGM became his toy. It remained that way off and on for over three decades.
Now Kirk is ruminating with friends that it may be time to try again. There’s an intriguing parlay here -- buy the MGM debt, restructure the company, kick out existing management. Having just sold his Ford stock and lost interest in his Detroit caper, Kirk clearly needs a new play thing. At 90+ he’s as sharp and agile as ever. And despite his losses and the sorry state of the economy, he’s in a damn good mood.
On the other hand, if Kirk for some reason decides against pursuing MGM for the third time, there’s yet another way he could contribute to his nation. Coming of age during the Great Depression, the teenage Kirk was unable to find a job. Penniless, he decided to sign on to the Civilian Conservation Corps, the New Deal program established by President Franklin Roosevelt to put people to work on infrastructure projects. Kirk was sent off to dig trenches and build bridges.
The program was a big success in re-starting the economy. It also got Kirk back on his feet. So if Kirk Kerkorian wants to take a vacation from the financial wars, he should sit down with President Barack Obama and explain his boyhood experience in economic recovery.
The country needs a new CCC more than it needs a new MGM.
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