The key business move that turned Desilu from a production company into a studio was the 1957 purchase of RKO Pictures’ production facilities. RKO had gone bankrupt and its parent company, General Tire and Rubber, was selling the assets. Desilu bought the RKO facilities — including the Gower Street studio in Hollywood and the RKO-Pathé lot in Culver City — for $6 million. The purchase gave Desilu 33 sound stages, more than either MGM or Twentieth Century-Fox possessed at the time.
For a company that had been renting space at General Service Studios only three years earlier, this was a dramatic escalation. Desilu was now in the real estate and facilities business as well as the production business. It could rent stage space to other producers, generate income from facility use independent of its own shows, and operate at the scale of a major studio without being owned by one of the established Hollywood powers.
Arnaz’s business instincts had driven many of these decisions. He had negotiated the ownership of the *I Love Lucy* prints. He had structured the company’s accounting in ways that accelerated debt payoff. He had identified the RKO purchase as an opportunity. He was, by the accounts of people who worked with him, a talented entrepreneur who happened also to be a performer.
The marriage ended in 1960. Ball and Arnaz divorced in May 1960, the year after *I Love Lucy*’s run had concluded. Arnaz sold his interest in the pre-1960 shows back to CBS. In November 1962, he resigned as president of Desilu and sold his remaining holdings to Ball. She bought him out and became president and CEO of the company.