No. 37

Kirk Kerkorian Takes MGM Public

Las Vegas billionaire Kirk Kerkorian, who just can’t seem to let go of Metro-Goldwyn-Mayer, enlisted the help of Wall Street last year to underwhelming results.

The 80-year-old financier, who in 1996 acquired the fabled movie studio for the third time, filed an initial public offering at a suggested price of $23 a share. The only problem: Investor reaction was so weak that Kerkorian had to buy 3.5 million of the 12.5 million shares himself to prop up the price when the company finally went public at $20 a share.

The tepid response was no accident: MGM has $800 million in debt and little prospect of seeing profits over the next few years (even though its newest James Bond thriller, “Tomorrow Never Dies,” is on its way to becoming the top-grossing 007 yarn ever).

Another reason why MGM has come up short is that Hollywood movie studios are no longer in just the movie business. They’re diversifying into television networks, theme parks and TV stations. MGM, however, has little diversification potential placing it at the bottom of the major Hollywood studios.