MGM Mirage Owner Kerkorian Loses Gamble on Ford Motor
Kirk Kerkorian has decided to start selling off his shares of Ford Motor Company. The billionaire, whose Tracinda Corporation owns controlling interest in casino giant MGM Mirage as well as a sizeable portion of Ford, sold 7.3 million shares of the auto manufacturer Monday.
Word was also that Tracinda had contacted an investment bank to unload the remaining 133.5 million shares of Ford in its possession.
Declining Ford stock prices had forced Kerkorian to use another 50 million shares of MGM Mirage to back his loan he used to acquire the Ford shares. Kerkorian had recently expressed confidence in the car company's turnaround, but the economic crisis and plummeting stock prices for both Ford and MGM forced his hand.
Ford stock has declined 74 percent in the last year, while MGM Mirage has dropped 83 percent.
Tracinda spokesmen said the company would be concentrating on its gambling, hotel, and energy businesses.
Bank of America, Tracinda's creditor for the $600 million used to buy Ford, did not say whether this meant an immediate repayment, or what arrangements to settle the debt were being made.
MGM Mirage is already suffering its own credit difficulties, as it struggles to find financing for the completion of construction of its CityCenter project in Las Vegas. The megaresort casino is being built at a time when other gambling operators are questioning the wisdom of opening new resorts, and even considering expanding to online casinos rather than committing huge sums to construction.
