Hard Rock Cafe sold to Native Americans
Seminole Tribe of Florida to pay $965 million to Britain's Rank Group for restaurant and casino business.
NEW YORK (CNN) -- In a cash deal valued at $965 million the Seminole Tribe of Florida purchased the Hard Rock cafe, hotel and casino business in a first-of-its-kind deal between the Native American tribe and Hard Rock's foreign parent company, both parties announced Thursday.
"Our ancestors sold Manhattan for trinkets. Today with the acquisition of the Hard Rock cafes we're going to buy Manhattan back one hamburger at a time," Max Osceola, Seminole Tribe representative, said at a press conference at Manhattan's Times Square Hard Rock Cafe location.
The president of the tribe's gaming operations, Jim Allen, said it beat out some 70 bidders for the Hard Rock franchise.
"This was a step into the real world to play with the big boys," said Allen, who proposed the acquisition to Seminole members.
The Seminole tribe has about 3,000 members and employs 7,000 workers in its gaming unit. The Native American tribe already owns and operates two Hard Rock hotel-casinos and five other casinos, all in Florida.
Hard Rock's worldwide portfolio includes 124 Hard Rock Cafes, four Hard Rock Hotels, two Hard Rock Casino Hotels, two Hard Rock Live concert venues and equity stakes in three unbranded hotels. Hard Rock generated $127 million in revenues for fiscal year 2006.
British company Rank Group, Hard Rock's parent, said Hard Rock has "limited synergies" with the rest of the group's businesses, and the sale of the subsidiary Hard Rock business, which also includes valuable rock 'n' roll memorabilia, will allow the group to focus on its own gaming operations.
When asked the price tag on the memorabilia, President and Chief Executive Officer Hamish Dodds of Hard Rock International would not disclose a monetary amount but said that because so many of the items were donated by famous musicians, "they're priceless."
Dodds presented Seminole tribal leaders with a highly coveted Hank Williams Sr. guitar in commemoration of the agreement.
The news conference announcing the deal began with Bobby Henry, a traditional Seminole medicine man and rainmaker, reciting a blessing in the Seminole native language.
The Seminole Tribe of Florida has business ventures in citrus groves and cattle-raising operations as well, but the gaming arm of the tribe is what has "allowed for the Seminoles to educate themselves in the world of business," Andrew Bowers, another tribal representative, told reporters.
"We have to move away from our specialty in order to keep moving forward," he added.
"Sopranos" actor and E Street band musician "Little Steven" Van Zandt made a cameo appearance during the media event. He closed his public comments by saying, "This is a good day for rock 'n' roll."
Earlier this week, Station Casinos Inc. (down $0.78 to $81.31, Charts) received a $5.15 billion management-led buyout offer to go private. And takeover talk for the casino operator Harrah's (down $0.40 to $79.62, Charts) has been ongoing for two months now, after after private equity firms Apollo Management and Texas Pacific Group first offered to buy the company for about $15 billion.
--from CNN's Katy Byron