HOLLYWOOD, FL-The locally based Seminole Tribe of Florida is buying the Hard Rock café, casino and hotel business from gaming operator Rank Group PLC of London for $965 million, or about £490 million. The deal, which the parties expect to close in March, will give the Seminole Tribe 124 Hard Rock Cafes, four hotels, two casino-hotels, two live-music venues and equity interests in three hotel assets.
Rank is selling the chain to focus on its UK gaming operations, which include 113 bingo clubs across the country. Seminole executives, the owners of Hard Rock Casinos here and in Tampa through agreements with Rank, were not immediately available for comment.
The Rank affiliate that owns Hard Rock is Orlando-based Hard Rock International. Just over half of the cafés are operated through license or franchise agreements, while the rest are company owned. Rank will continue to own the Hard Rock Casino in London and will eventually convert it into one of its other brands. The Hard Rock Hotel in Las Vegas is owned by an independent operator.
The Seminole Tribe owns properties on its reservations throughout the state, which are here, as well as in Big Cyprus, Brighton, Fort Pierce, Immokalee and Tampa. Other than the two Hard Rocks, the tribe also operates casinos here, in Brighton and in Immokalee.
Hard Rock International has been repositioning some of its properties as of late. After moving its New York City location, the firm has planned to relocate its Boston location from Copley Square to near the entrance of the General Growth Properties-owned Faneuil Hall Marketplace.
According to its half-year financial report, released in September, same-store café sales rose 8.2% year over year. Revenues were up at its company-owned cafés rose from $205.3 million to $216.8 million a year ago, and operating profit increased from $23.4 million to $24.8 million.At the company's franchised units, royalties and fees soared 48.1% to $7.7 million, and operating profit jumped 58.5%, to $6.5 million. The increase was attributed to fees from Hard Rock Music Park in Myrtle Beach, SC, which is under construction and set to open in 2008.
At the company's eight hotel-casino concepts, revenue jumped from $14.5 million to $16.3 million and operating profit increased from $11.8 million to $14 million. Hard Rock International is owned by the London-based Rank Group.
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