Former Aussie entrepreneur Christopher Skase claims that Kirk Kerkorian reneged on the 1989 $ 1 billion sale of MGM/UA to Skase’s Qintex Corp. when he saw Sony bidding nearly three times as much for the “comparable” Columbia Pictures. To get out of it, says Skase, Kerkorian made the deal too rich.
Self-exiled on Mallorca, Spain, the bankrupt Skase made the statement during a two-hour Network Ten special, which aired here Wednesday night.
Skase denied that the deal fell through when he failed to deliver a $ 50 million down payment, saying, “Kerkorian offered to sell from MGM/UA essentially the assets and operations of United Artists. And keep the MGM side, which was much smaller.
“As the weeks went by, the whole entertainment industry was re-rated in the stock market. Sony bid for Columbia at a price which showed how inexpensive our offer for UA was. We were paying $ 600 million for assets which were comparable — not totally identical but comparable — to assets which Sony had agreed to pay $ 3 billion, or five times, for. And even if you adjusted Columbia’s theaters and other assets, their price was more than 2 1/2 times what we had paid.
“Kerkorian then saw ‘The train is leaving the station, the market is rising. I’ve got to get out of this and put it back on the auction block.’ He was able to do that by then relinquishing that which he didn’t want to relinquish, which was the MGM logo and related assets. That’s how he got out of it.
“We ran MGM/UA for six months and to our great credit lifted the company’s cash position from relatively lowly to approaching $ 200 million. And we managed the company efficiently, effectively and professionally. We left no dirty marks on MGM.”
Closer to home, Skase was scathing about Rupert Murdoch and the current management of the Seven Network, the last remaining asset of Qintex, his over-extended former TV and real estate empire.
On Murdoch (who bid against him for MGM/UA and referred to the new generation of network owners to which Skase belonged as “amateurs”): “His ego is so outsized as to be immeasurable.”
“The Murdoch regime at the Ten Network was spectacularly unsuccessful. It is a matter of statistical record that my performance … leading Seven is a vastly superior performance than him and his company’s ownership of the Ten Network when he left it.” Skase claims that when he sold Ten, Murdoch handed Frank Lowy an “unholy mess. He got taken to the cleaners.”
After claiming that virtually all the major successes still being enjoyed by the Seven Network were instigated while he was at the helm, Skase said, “There are a lot of people in the television industry who live in a state of perpetual movement. They will follow with their kitbag, whoever the king of the day is. There’s no loyalty and one of the mistakes I made was in not cutting out some of the cancer in the network.”