Regis Announces Transaction With Empire Education Group
February 03 2020 - 6:00AM
Business Wire
Regis Corporation (NYSE: RGS), a leader in the haircare
industry, whose primary business is franchising, owning, and
operating technology enabled hair salons, today announced a
transaction with Empire Education Group (EEG), an operator of
accredited cosmetology schools. Regis currently has an approximate
55% ownership interest in EEG. Regis and EEG entered into an
agreement pursuant to which Regis will sell its interest in EEG in
exchange for de minimis cash compensation, an exclusive private
label supply agreement, and an employer of choice arrangement.
Coincident with this transaction, Regis and EEG are announcing a
strategic “Employer of Choice” agreement. This agreement designates
Regis franchised and company-owned salons as the favored employers
for students graduating from Empire cosmetology schools. Although
Regis and EEG have always had a close partnership, this agreement
differentiates Regis in the salon industry. The agreement includes
EEG’s promotion of Regis franchised and company-owned locations as
a “preferred” employer to students, allows Regis to host exclusive
national hiring events at EEG locations, gives Regis greater access
to Empire students through multiple channels, and continues
combined efforts to maximize the placement of students within
Regis’ franchised and company-owned salons. “We have enjoyed a
strong partnership with Empire and this agreement strengthens and
solidifies that relationship. We expect this evolution of our
partnership will provide an advantage to our franchise and
company-owned salons in our efforts to recruit the stylist talent
needed to support our future growth,” said Shawn Moren, Executive
Vice President & Chief Talent Officer of Regis Corporation.
The transaction is subject to customary closing conditions,
including regulatory approval, and is expected to be completed in
Regis’ fourth quarter of fiscal 2020.
“These agreements de-complicate and de-risk our business
enabling us to focus on our ongoing strategic transformation while
preserving and enhancing the essential value we derive from our
relationship with Empire Education,” commented Amanda Rusin, Senior
Vice President & General Counsel.
About Regis Corporation Regis Corporation (NYSE:RGS) is a
leader in beauty salons and cosmetology education. As of September
30, 2019, the Company franchised, owned or held ownership interests
in 7,092 worldwide locations. Regis' franchised and corporate
locations operate under concepts such as Supercuts®, SmartStyle®,
Cost Cutters®, Roosters® and First Choice Haircutters®. Regis
maintains an ownership interest in Empire Education Group in the
U.S. For additional information about the Company, including a
reconciliation of certain non-GAAP financial information and
certain supplemental financial information, please visit the
Investor Information section of the corporate website at
www.regiscorp.com.
Safe Harbor Statement This press release contains or may
contain "forward-looking statements" within the meaning of the
federal securities laws, including statements concerning
anticipated future events and expectations that are not historical
facts. These forward-looking statements are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. The forward-looking statements in this document
reflect management's best judgment at the time they are made, but
all such statements are subject to numerous risks and
uncertainties, which could cause actual results to differ
materially from those expressed in or implied by the statements
herein. Such forward-looking statements are often identified herein
by use of words including, but not limited to, "may," "believe,"
"project," "forecast," "expect," "estimate," "anticipate," and
"plan." In addition, the following factors could affect the
Company's actual results and cause such results to differ
materially from those expressed in forward-looking statements.
These factors include the consummation of the transactions with EEG
as scheduled or at all and the Company’s ability to maintain its
relationships with EEG as contemplated by the transaction
agreements and realize the expected benefits. Additional
information concerning potential factors that could affect future
financial results is set forth under Item 1A on Form 10-K. We
undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. However, your attention is directed to
any further disclosures made in our subsequent annual and periodic
reports filed or furnished with the SEC on Forms 10-K, 10-Q and 8-K
and Proxy Statements on Schedule 14A.
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version on businesswire.com: https://www.businesswire.com/news/home/20200203005147/en/
REGIS CORPORATION Kersten Zupfer
investorrelations@regiscorp.com
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