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The Nation | COLUMN ONE

A Born Gambler Rolls the Dice at 88

Billionaire Kirk Kerkorian has bought and sold airlines, movie studios and Las Vegas casinos. Now he's placing a bet on GM.

June 09, 2005|David Streitfeld | Times Staff Writer

Take his investments in Las Vegas. He started going there in 1946, flying high rollers from L.A. who didn't want to waste precious gambling time on what was then a 10-hour car trip. He began investing in the city nine years later, putting $50,000 into a hotel. It wasn't a good moment -- the city was in one of its periodic over-built phases -- and he lost the money.

Subsequent investments, in both land and hotels, were more profitable. Three times -- in 1969, 1973 and 1993 -- Kerkorian built the largest hotel in the world in Las Vegas. He would buy something or build something, sell it when the time was right or, occasionally, when he had to, and then regroup and buy something else.

In April of this year, MGM Mirage, a publicly traded company that is 55% owned by Kerkorian, bought Mandalay Resort Group for $7.9 billion. That brings its Vegas properties to 11, including some of the biggest and best-known: the Bellagio, Mirage, Luxor, Excalibur, New York New York, Circus Circus, MGM Grand and Mandalay Bay hotel-casinos.

Despite his long residence in Los Angeles, Las Vegas is Kerkorian's kind of place. Picture yourself a street kid in the Los Angeles of the early 1920s, he says. What do you do for entertainment when you're not sneaking into movies? You draw a line in the dirt and pitch pennies -- if not for money, for bottle tops.

"I'm a gambler at heart," he says. "That's my life." Every time he landed a plane during the war, he would find the poker game on the base and play for hours.

Kerkorian used to gamble just like everyone else, by chasing bets and staying at the tables forever. One anecdote has him coming to Vegas with friends, sending their bags up to their rooms and plunging into gambling. They lost all their money, sent the bellman up to fetch their bags and went home, without ever seeing their rooms.

Finally realizing that sort of gambling didn't pay off, he says, "I shortened the play."

He decides his betting limit and if he loses it, even after only five minutes, he walks away. His casinos would go broke if all gamblers took this approach.

"I never know when to stop," says Las Vegas developer Irwin Molasky. "I'm like most gamblers. Kirk knows when to stop. He has a plan, always."

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There's only one other person who flew planes and owned an airline, a Hollywood studio and Vegas hotels and casinos: Howard Hughes, of course.

Kerkorian, one of the few people still around who met Hughes in person, loved Martin Scorsese's biopic "The Aviator." He compares himself to Hughes, but only to point out his own insignificance. "This guy broke real speed records. He designed airplanes. He was a great engineer. He did huge things."

But for 20 years, until his death in 1976, Hughes was a genuine recluse, lost in obsessive-compulsive disorders and other phobias. That period is what's remembered in the popular imagination, not his achievements.

It's a tragedy, Kerkorian says. "He had some of the worst [airplane] crackups you ever saw. He got really stuck on drugs. It was too bad there was nobody strong enough around him to say, 'You've got to clean up.' He didn't have dear friends like I do."

Kerkorian has always been loyal to his friends, and they've always been loyal to him. When young Kirk was sent to reform school, his best friend, Norman Hungerford, intentionally misbehaved so he would be sent there too. After 80 years, the two still keep up.

If his friends help keep his life in balance, tennis is what gives Kerkorian energy. He was a late convert to the game, not picking up a racket until he was 50. Now he plays several times a week, often in a doubles competition with buddies affectionately named "the grudge match." They play, eat lunch, play again.

"We used to have such fun teasing each other about it," says Joe Sugerman, one of the players. "It was a terrific escape from all the pressures of the week."

Sugerman is speaking in the past tense because some of the fun has gone. Kerkorian's regular partner was ICM agent Mort Viner. During a game two years ago, the players were changing sides when Viner fainted. A heart attack killed him. In his memory, at lunch the players keep his chair vacant.

Recently, Kerkorian has been playing in senior tournaments for those 85 and up. The U.S. Tennis Assn. ranked him and his doubles partner, 88-year-old Irving Converse, 11th in their age category.

"Some old guys get pretty upset about losing. Kirk's not like that," Converse says. "He enjoys the game, win or lose. Of course, the more he wins, the better."

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Times staff writer John O'Dell contributed to this report.

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(BEGIN TEXT OF INFOBOX)

A deal maker's long career of bold investments

1947: Kirk Kerkorian buys an air charter called Los Angeles Air Service for $60,000. It owns a DC-3, a Beechcraft and a Cessna. The company is later renamed Trans International Airlines.

1962: Sells the airline to Studebaker Corp.

1964: Buys back the airline.

1968: Sells the carrier to Transamerica for stock that eventually nets him $104 million.

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