Hard Rock sold off cheap, say analysts - Tuesday 12th of December 2006

Investors and analysts gave a cool reception to the £490 million sale of the Hard Rock Cafe chain by Rank Group yesterday, describing the price tag as “modestly disappointing?.

Rank said the sale of the rock-themed chain to the Native American Seminole tribe, which operates two Hard Rock hotel and casino resorts in Florida, would allow it to open up its casino market.

Seminole Hard Rock Hotels and Casinos, which has resorts on its reservations in Hollywood and Tampa, said it would continue to build Hard Rock casino-hotels. It saw off competition from private equity groups, including Permira, TDR Capital and Apollo Management, to clinch the deal.

Shares in Rank dropped nearly 5 per cent to 254¾p last night as investors digested the news. Analysts were also unconvinced, with Merrill Lynch saying the disposal price was below its estimated £525 million valuation. The broker retained its “sell? recommendation.

Mark Reed, at Teather & Greenwood, said a higher price was expected, on account of “huge brand recognition?.

News of a 15 per cent slide in revenues at Rank’s Scottish bingo operations last year, hit by the smoking ban, also contributed to the share fall. Rank said admissions at Mecca Bingo in Scotland had fallen 6 per cent and spend per head by 9 per cent. In the second half, total revenue from the bingo halls was down 2 per cent, despite it growing market share, up 3 per cent to 34 per cent.

Rank, which has shed household names such as Butlins, Odeon and Pinewood to focus on gaming, said revenue growth had slowed at its Grosvenor Casinos to 4 per cent in the second half from 9 per cent in the first half.

Other news from around the same time

150 JOBS AT CITY CASINO - Tuesday 12th of December 2006

Work is under way to create a new casino costing £7m and creating 150 jobs. Stanley Leisures Nottin....


Ladbrokes to buy online casino 888 - Tuesday 12th of December 2006

A £490M takeover of online gambling group 888 by bookmaker Ladbrokes is imminent. The two companie....


Viva Macau gets green light to fly in December - Tuesday 12th of December 2006

Viva Macau, the first low-fare airline based in Macau, officially received the Air Operators Certifi....


Illegal Gambling Machines Seized - Tuesday 12th of December 2006

ELEVEN slot machines have been seized from taxi offices and takeaways in a swoop on illegal gambling....


Singapore to name winner of casino bid this week - Tuesday 12th of December 2006

Singapore is expected to announce the winning bid for its second casino resort this week in a deal w....


In the 17th century, ancestors of the Pequot Tribal Nation lost their position as the dominant culture along New Englands Atlantic Coast. - Tuesday 12th of December 2006

Station Casinos Inc. said on Monday it received a management-led buyout offer from a group including....


Tribe sees a big prize in a riverfront casino - Tuesday 12th of December 2006

In the 17th century, ancestors of the Pequot Tribal Nation lost their position as the dominant cultu....


Aristocrat hopes to cash in - Tuesday 12th of December 2006

ARISTOCRAT Leisure Ltd hopes to share in the spoils of Publishing and Broadcasting Ltds move into As....


One step closer to casinos in Cyprus - Tuesday 12th of December 2006

THE first concrete steps towards the establishment of a casino on the island have taken place follow....


Del. slot casinos start to feel the squeeze - Tuesday 12th of December 2006

For more than a decade, Delawares three slot machine casinos have essentially had a license to print....