The length and value of the contract were not disclosed in a prepared statement from XO.
The contract calls for XO to provide local and long-distance telephone calls and handle the chain's online site, PlanetHollywood.com. Planet Hollywood estimates it will be able to reduce online expenses by 44% and other telecommunication expenses by 50%.
"We looked at the traditional players in the data and voice communications industry and found each falling short of our need for simplicity, high-service levels and real cost savings," Tina Samson, Planet Hollywood's senior vice president/finance, says in the statement.
XO Communications president Michael Ruley adds, in the same statement, "XO's presence in 62 U.S. markets, including a majority ;of the top 50 markets, enables multi-location companies, such as Planet Hollywood, to spend less time managing relationships with multiple telecom vendors and focus (instead) on operating their business."
Tied in with Planet Hollywood's cost-savings program is the company's plan to relocate its 85-person corporate staff from the four-story, 80,000-sf headquarters building at 8669 Commodity Circle, south Orlando, to 15,000 sf in a nearby 85,000-sf office/warehouse building. Planet Hollywood stores its $27 million memorabilia collection at that location.
Fairfield Communities Inc., the largest time-share developer in Florida, will take over Planet Hollywood's corporate space and occupy the entire building. Fairfield currently occupies the building's first three levels.
Planet Hollywood is receiving an estimated $22 per sf rent on a 10-year lease from Fairfield, area brokers familiar with the south Orlando submarket tell GlobeSt.com.
Planet Hollywood filed for Chapter 11 protection from creditors under the U.S. Bankruptcy Code in October 1999 and emerged from court protection in May 2000. The company lost $79.7 million on operations in fiscal 2000, an improvement from a $194 million loss in fiscal 1999.
Among the major shareholders who own 70% of the company are Robert I. Earl, chairman/CEO; Saudi Prince Alwaleed Bin Talal, the controlling principal of Kingdom Planet Hollywood Ltd.; Singapore billionaire Ong Beng Seng, the lead principal of Leisure Ventures; Bay Harbour Management of New York; and Magnetic Light Profits, a subsidiary of Star East Holdings Ltd.
Planet Hollywood's Over-the-Counter common was trading at 51 cents per share this morning (Aug. 7) on volume of 2,000, up 16 cents (45.71%) from 35 cents per share Aug. 2. There are 10 million shares outstanding. The company has a market capitalization of $5.1 million, according to Standard & Poor's Corp.
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