The chairman and chief executive of the US giant land gambling group MGM Mirage, J. Terrence Lanni (65) is to retire at the end of this (November) month, a company spokesman has announced. The resignation has nothing to do with recent allegations of false educational claims that have swirled around the veteran gambling executive, Lanni and spokesmen emphasised.
Bloombergs reports that MGM Mirage is majority-owned by billionaire Kirk Kerkorian, and that Lanni has recommended to the board of directors that President and Chief Operating Officer Jim Murren (47) is the ideal executive to succeed him. Lanni hopes to remain on the board.
"It's time for a younger generation to take over," Lanni said in a telephone interview with the news agency. He also cited a desire to spend more time with his family. Later, he added in a company statement: "I believe it is now time to step aside from full-time engagement and turn over the reins to the new generation. Jim [Murren] is fully equipped to lead the company through these turbulent times in the global economy and take it to new levels of growth and success."
In a subsequent interview with the Las Vegas Review-Journal, Lanni said: "Frankly, I came very close to making this decision a year ago. The challenges that we are facing as a company I believe are best addressed by a younger person. Jim is the person to lead the company."
Lanni served as chairman for more than 13 years, expanding the company from one property in Las Vegas to 17 resorts worldwide. He oversaw MGM Grand Inc.'s combination with Mirage Resorts in 2000 and Mandalay Resort Group in 2005. The company had $7.7 billion in revenue last year. Prior to joining MGM Mirage, Lanni spent 18 years as a senior executive at Caesars World, including 14 years as president and COO.
Lanni leaves as MGM Mirage and other casinos struggle with the worst financial crisis since the Great Depression, reports Bloombergs. Its shares have plunged 87 percent this year as it has tried to get enough cash to cover loans and finish the $11.2-billion CityCenter project on the Las Vegas Strip. The group saw its third-quarter profit this year fall 67 percent from a year ago. The company has undergone several cost reduction measures, including corporate restructuring and downsizing, and other strategic budgetary initiatives.
MGM Mirage Senior Vice President of Public Affairs Alan Feldman told the LVRJ: "Terry considered retirement - and did in fact retire - almost ten years ago. It was the unparalleled opportunities presented by the mergers with Mirage Resorts (2000), Mandalay Resort Group (2005) and the initial planning and development of CityCenter that brought him back to the company.
"Further, the company has been actively implementing a succession plan for almost 2 years including the appointment of Jim Murren as COO more than a year ago."
Heir apparent Jim Murren joined MGM Grand in 1998 as chief financial officer after spending 14 years on Wall Street as an equity analyst and managing director of Deutsche Bank. Murren was named company president in 1999, prior to the buyout of Mirage Resorts. In 2007 he relinquished his CFO duties to take on the responsibilities of chief operating officer, overseeing the day-to-day operations of the company's hotel and casino properties as the second most senior exec in the company.
Murren is well informed on company policies and strategy, having served on the group management committee with Lanni, MGM general counsel Gary Jacobs and Chief Design and Construction executive Bob Baldwin.
According to LVRJ, Lanni will have a comfortable retirement; in 2007 his basic salary was $2 million, to which a further $10.7 million was added in incentives and perks.
In a company statement, Murren said he was honoured that Lanni had recommended him as his successor. "As a direct result of Terry's leadership, we have a remarkable depth of seasoned management." Murren said. "I am confident of our company's ability to manage through the current economy and emerge stronger, more vigorous and well-positioned to capitalize on future opportunities as the economy rebounds from its current slowdown."
MGM Mirage majority shareholder Kirk Kerkorian praised Lanni and said he played a key role in the casino operator's growth and expansion. "The company will always be indebted to Terry for his many years of leadership and wisdom," said Kerkorian, a 91-year-old Los Angeles billionaire who controls about 53 percent of the company's shares. "We are delighted that he will remain as a member of the board and that the company will have available his wealth of experience and institutional knowledge."
MGM Mirage controls 10 Strip resorts, including MGM Grand, Bellagio, The Mirage and Mandalay Bay. The company operates 44 percent of the Strip's available hotel rooms. In total, MGM Mirage owns and operates 17 resorts in Nevada, Mississippi and Michigan. It has 50 percent partnerships in four other properties in Nevada, New Jersey, Illinois and Macau.