The most prestigious deal in the history of Native Americans was completed on Monday, March 5 when Florida’s Seminole tribe sealed the deal to purchase most of the Hard Rock Cafe/Casino properties across the globe. Most of the chain’s locations owned and operated by The Rank Group PLC of Great Britain will become part of the new Seminole empire, all for the price of $965 million.
The total deal works out like this: A $525 million bond offer, $500 million in an equity contribution, and $35 million for closing costs and operating capital. Final details were hammered out in London, New York, and Florida. It allows the tribe entry into other states where gambling is permitted, making them the first Native American owners of an international business empire. It almost makes that Manhattan Island deal look like a drop in the bucket.
Tribal vice chaiman Moses Osceola said in a statement that this acquisition “Makes our economic survival a little bit more sure.” The purchase includes 124 Hard Rock Cafes, 5 Hard Rock branded hotels, two casinos, two concert venues, three other unbranded hotels, and a 70,000 piece inventory of rock ‘n’ roll memorabilia, late last year embellished with guitars formerly owned by Eric Clapton and Jimi Hendrix. Further sweetening the deal for the Florida tribe is the fact that Hard Rock’s business was up 18.7 percent last year.
The Seminoles were the first Native Americans to get into the gaming business after breaking into tobacco sales and distribution, which pulled them out of poverty and made Natives major business operators. Before today’s transaction they owned seven Florida casinos, and 90 percent of their revenue was derived from gaming, with each tribal member getting a monthly dividend from the $500 million a year business.
Expansion plans call for 15 new Hard Rock properties within the next four years, including San Diego and Palm Springs in California, Copper Mountain in Colorado, and a major casino hotel in Macau, an Asian nation that is currently undergoing a renaissance from the gaming industry after being known primarily as the number one source of fireworks in the world.
Hard Rock’s Las Vegas casino, as well as other properties in Australia, Israel, Brazil, Venezuela, and other locations in the western United States are not a part of this sale. They are owned and operated by a different company, Morgan’s Hotel Group. The Rank Group will keep their Hard Rock property in London, but will rename it under their Rank Gaming Brand and use it as their showcase property while they concentrate on revitalizing their brand in Europe.