Seminole Tribe of Florida buying Hard Rock cafe business for $965 million
Thursday, December 7th 2006, 6:22 am
By: News On 6
LONDON (AP) _ The Seminole Tribe of Florida is buying the Hard Rock business, including its massive collection of rock 'n' roll memorabilia, in a $965 million deal with British casino and hotel company Rank Group PLC.
The Hard Rock business includes 124 Hard Rock Cafes, four Hard Rock Hotels, two Hard Rock Casino Hotels, two Hard Rock Live! concert venues, and stakes in three unbranded hotels.
With it, the tribe acquires what is said to be the world's largest collection of rock memorabilia, some 70,000 pieces including Jimi Hendrix's Flying V guitar, one of Madonna's bustiers, a pair of Elton John's high-heeled shoes and guitars formerly owned by Bob Dylan, Eric Clapton and Chuck Berry.
``This is a proud moment for the Seminole Tribe of Florida and for all Indian tribes,'' said Mitchell Cypress, chairman of the elected Tribal Council. ``It is also an opportunity for the Seminole Tribe to diversify its business operations and help a very successful company to achieve even greater growth.''
Cypress and Seminole Gaming Chief Executive James Allen said in a statement that the tribe would work with current Hard Rock International management to build on existing growth plans.
In addition to its two Seminole Hard Rock hotels & casinos, the Seminole Tribe owns and operates five other casinos in Florida. More than 90 percent of the tribe's budget now comes from gaming revenue.
Nearly 3,300 Seminole Indians live on and off reservations throughout Florida. Rank said it would keep the Hard Rock Casino in London but under the Rank Gaming brand.
``We have maximized the value of Hard Rock through this disposal following a thorough strategic review and competitive auction,'' said Rank Chief Executive Ian Burke.
Burke said the company would return 350 million pounds ($690 million) of the sale proceeds to shareholders in a special dividend of 65 pence ($1.28) per share.
Last year, Hard Rock posted revenue of 250.1 million pounds ($493 million) and profit before interest and taxes of 34.8 million pounds ($68.6 million), Rank said.
The sale, which is subject to shareholder approval, is scheduled to be completed in March.
Rank shares were down 0.6 percent at 265 pence ($5.22) on the London Stock Exchange.