Kinney National Services, Inc. was established in 1966 as a result of the merger between Kinney Parking Company and National Cleaning Company as a media and entertainment company. As at the time of its formation, the company had Steve Ross as its head. In 1967, Kinney National Services, Inc. expanded its operations through the acquisition of National Periodical Publications (quite often known as the DC Comics), Ashley-Famous (the talent agency of Hollywood) as well as the Panavision. In 1972, Kinney National Company was reincorporated as Warner Communications, with Steve Ross as the organization’s chief executive officer. Charles A. Agemian, the chief executive officer of the Garden State National Bank was made the director of the company. Following the acquisition of Warner Bros.-Seven Arts in 1969 and the violation of the anti-trust laws, Ashley-Famous was sold. The anti-trust laws prohibited the ownership of both a talent agency and a production studio. Therefore, Ashley-Famous had to be sold and Ted Ashley made the general overseer of the movie studio.
The financial scandal occurred in the parking division in between 1969 and 1971 over the parking operations. The company expanded into the real estate development from the parking and the building services after the purchase of Uris Buildings Corporation. The timing for this purchase was poor due to the collapse of the New York real estate market, which led to the lost of the Uris Building to foreclosure. According to Harold Uris, Kinney allowed the bank to foreclose the building, especially due to the fact that the new Uris Theater was housed by it. At least, there ought to be some patience. The advice of Harold Uris was never sought. Even his phone calls were never picked up. After the acquisition of the eight building package, the company relinquished its Uris holdings, where they stayed in the market for three years and finally purchased at $320 million, a value far below the market’s current value. In addition, there was an attempted purchase of the Aladdin hotel and the casino with plans of renaming it. However, the information leaked through Joanna, Johnny Carson’s wife, and the subsequent trades in the company’s stock led to the insider trade changes against the third parties by the Securities and Exchange Commission and disgorgement of the profits. The scandal was valued at US$205 million. Due to this scandal, the end-result was the spinning off of the non-entertainment assets of Kinney National as National Kinney Corporation, and the changing of its name to Warner Communications Incorporation, which was headed by Steve Ross as the CEO, the president, and the chairman. The company’s new directors included, among others, Charles A. A, who was the CEO of the Garden State National Bank.
Later in 1982, the National States Electric division of National Kinney was sold to a buyer, whom they deliberately refused to disclose, and the parking subsidiary (Kinney System Incorporation) sold to Daniel Katz, the division’s chairman, and other investors. The National Kinney then renamed to Andal Corporation and the remaining majority interest sold in Kinney System parking.
Reference
Hephaestus Books, 2011. Corporate Scandals, including: Enron, Lucent Technologies, Long-term Capital Management, Mark Whitacre, Mci Inc., Bank Of Credit And Commerce Company, Conrad Black, Crazy Eddie, Parmalat. Hephaestus Book.
Jerry W. Markham, A financial history of modern U.S. corporate scandals: from Enron to reform. Retrieved at http://books.google.com/books?id=Z7qTGiF8FCgC
Kinney National Company. Retrieved at http://en.wikipedia.org/wiki/Kinney_National_Company
New York Times, 1982. "Kinney Asset Sale" NYTimes.com. Retrieved at http://www.nytimes.com/1982/02/20/business/kinney-asset-sale.html
New York Times, 1982. "Kinney to Sell Car Parking Unit". NYTimes.com. 1982-06-05. Retrieved at http://www.nytimes.com/1982/06/05/business/kinney-to-sell-car-parking-unit.html
Specter, Michael, 1981. "Q136.43 - Q136.43 - HAROLD URIS RECOLLECTS WITH PRIDE". New York City: NYTimes.com. Retrieved at http://www.nytimes.com/1981/07/19/realestate/q136.43-harold-uris-recollects-with-pride.html?&pagewanted=2
