ORLANDO Fla. The Seminole Tribe of Florida moved one step closer to completing its $965 million purchase of Hard Rock International Inc., which operates or franchises 124 Hard Rock Cafes and eight Hard Rock-branded hotels and casinos, by settling a lawsuit arising from the deal, according to a Bloomberg report.
The Tribe was hit with a lawsuit in January from Power Plant Entertainment LLC and its affiliate, Cordish Co., the companies that developed two Hard Rock-branded casinos for the Seminole Tribe in 2004. The plaintiffs alleged they were shut out of the bidding process for Hard Rock when it was first put up for sale by parent company Rank Group PLC. Under terms of the settlement, which Bloomberg attributed to a disclosure from Standard & Poor's Ratings Services, the Seminole Tribe will loan Power Plant $525 million and give the company $10.5 million annually over 22 years.
The sale is now expected to close March 5.
For fiscal 2006, Hard Rock International's operating profit increased 18.7 percent to $74.8 million, the company said in a statement Friday. The company's casino operations drove growth, with income up 23.3 percent in 2006 versus 2005. Hard Rock Cafe's profit increased 11.1 percent, the company said.
Total revenues grew 10.9 percent to $501.9 million, which reflected a 6.5-percent same-store sales increase at corporate restaurants. Hard Rock said its improved menu offerings, like certified Angus beef burgers, and the installation of hardwood smokers in each restaurant, helped to drive sales.