The Rank Group considers selling Hard Rock brand

The Rank Group is considering the sale of its Hard Rock brand to drive its expansion in the café, hotel and casino markets.

It has hired investment bankers Merrill Lynch International to help it review the strategic options for Hard Rock over the next few months.

They range from an outright sale to keeping the status quo.

In a trading statement for the 26 weeks to 25 June, Rank said the Hard Rock brand had performed strongly, and was poised to enter a new phase of development.

The brand has grown rapidly in recent years to total 120 cafés in 40 countries (of which 68 are company-owned and 53 are franchised), six casinos (including venues in London and Manchester) and 11 franchised hotels (of which two are hotel-casinos operated by the Seminole Tribe in Florida).

During the six months to June, company-owned cafés boosted like-for-like sales by 8% and total sales by 6%. The cafés have increased food and beverage sales by 10% and merchandise sales by 5%.

Revenues from franchise royalties also improved.

Profits in the group’s gaming business – which include Grosvenor Casinos, Mecca Bingo and Blue Square - were hit by rising costs and the start of the smoking ban in Scotland.

In the 13 weeks of the Scottish smoking ban, Rank’s 15 clubs in the region saw sales fall 14%, and a 9% decrease in spend-per-head among punters.

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By Angela Frewin

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