8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 12, 2007

REGIS CORPORATION

 (Exact name of Registrant as specified in its charter)

Minnesota	1-12725	41-0749934
(State or other	(Commission	(IRS Employer
jurisdiction of	File Number)	Identification
incorporation)	Number)
	7201 Metro Boulevard
	Minneapolis, Minnesota
	(Address of principal executive offices)
	(Zip Code)

(952) 947-7777

(Registrant’s telephone number, including area code)

                Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01.   Entry into a Material Definitive Agreement.

On October 12, 2007, Regis Corporation (the “Company”) entered into a Business Combination  Agreement (the “Business Combination Agreement”) pursuant to which it agreed to enter into a transaction combining the Company’s European retail hair salon operations with the retail salon businesses operated in Europe by the Franck Provost group.  The Company will hold a 30% interest in the combined business resulting from the transaction (the “Combined Business”) and individual members of the Franck Provost family and related legal entities (the “Provost Family”) and Artal Services N.V. (“Artal Services,” and together with the Provost Family, the “Provost Group”) will collectively hold the remaining 70% interest in the Combined Business.

Structure

     The Company will contribute to the Combined Business the shares of each of its European operating subsidiaries, other than the Company’s operating subsidiaries in the United Kingdom and Germany.  The contributed subsidiaries operate retail hair salons in France, Spain, Switzerland and several other European countries primarily under the Jean Louis David™ and Saint Algue™ brands.

The Provost Group will contribute the shares of Franck Provost Coiffure SAS and its subsidiaries, which operate retail hair salons throughout Europe.  The subsidiaries contributed to the Combined Business by the Company will be contributed free of debt and with at least €2.5 million in available cash or cash equivalents. The subsidiaries contributed to the Combined Business by the Provost Group will be contributed with all debt and cash and cash equivalents existing as of the closing of the transaction.

Management

The operations of the Combined Business will be overseen by a five-member board of directors consisting of one representative designated by the Company, three representatives designated by the Provost Family and one representative designated by Artal Services. The current senior management of the Franck Provost group, including founder and chairman Franck Provost, Marc Aublet, president and chief operating officer, and Daniel Gagnor, chief financial officer, will be responsible for the management of the Combined Business. The demonstrated capabilities and experience of the senior management of the Franck Provost business is one of the principal factors considered by the Company in entering into the transaction.

Under the Business Combination Agreement, the approval of the Combined Business’s board of directors, including the approval of the representative designated by the Company, is required to in connection with certain significant corporate transactions, including material acquisition and divestiture transactions, the incurrence of indebtedness in excess of agreed thresholds, certain employment and employee compensation-related arrangements the entry into or modification of material agreements, modification of the bylaws of the Combined Business and material related-party transactions.

Transfer of Interests in the Combined Business

The Business Combination Agreement generally prohibits both the Company and the members of the Provost Group from transferring their respective interests in the Combined Business without the approval of the other party.

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Put and Call Rights

Commencing on the second anniversary and continuing through the tenth anniversary of the date of the formation of the Combined Business, Artal Services has the right to require the Company to purchase its interest in the Combined Business. The Company has the right to acquire the interest in the Combined Business held by Artal Services commencing on the tenth anniversary and continuing through the twelfth anniversary of the date of the formation of the Combined Business. If Artal Services exercises its put right, the Provost Family has the right to purchase all or a portion of the interest to be sold by Artal Services on the same terms and conditions as would be applicable to the sale of the interest to the Company. The Company is obligated to purchase any portion of the interest of Artal Services not purchased by the Provost Family.  In addition, the Company will continue to be entitled to exercise its call right with respect any portion of the interest in the Combined Business that is purchased by the Provost Family upon Artal Services’ exercise of its put right.

The price payable in connection with the Company’s acquisition of Artal Services’ interest in the Combined Business is determined based on the earnings before interest and taxes of the Combined Business for a trailing 12-month period. The acquisition price is intended to approximate the fair market value of Artal Services’ interest in the Combined Business at the time of the acquisition, valuing the Combined Business on a cash free-debt free basis as a going concern based on prices paid in comparable recent transactions for similar businesses.

If Artal Services exercises its put right, the Company will be entitled to a period of up to six months in which to arrange for financing for the purchase of Artal Services’ interest in the Combined Business.  If the Company is unable to arrange financing by the end of this period, Artal Services will be entitled to exercise various remedies, including the right to purchase the Company’s interest in the Combined Business for a purchase price determined based on a discounted multiple of the earnings before interest and taxes of the Combined Business for a trailing 12-month period.

Noncompetition and Related Provisions

                The Combined Business and its subsidiaries are prohibited from engaging in the hair restoration business, conducting business in the Wal-Mart North America or Seiyu shopping center networks and conducting business under the Jean-Louis David™ brand in the New York metropolitan area.

                Subject to certain limited exceptions, the members of the Provost Group are prohibited from engaging in any retail hair salon business following the formation of the Combined Business and for a three-year period, in the case of the members of the Provost Family, or 18-month period, in the case of Artal Services, following the date they cease to be shareholders in the Combined Business. This noncompetition obligation is applicable in the case of members of the Provost Family to all countries in which the Combined Business conducts business.  With respect to Artal Services, the noncompetition obligation is limited to those countries in which the Combined Business operates 50 or more retail locations.

                If Regis or any of its subsidiaries proposes to acquire a competing business operating retail hair salons in Europe, it is obligated to offer the right to purchase the competing business to the Combined Business.  If the Combined Business or any of its subsidiaries proposes to acquire any competing retail hair salon businesses in the United States, Canada or Mexico, it is similarly obligated to offer the right to purchase the competing business to the Company.

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Conditions to Closing

The board of directors of the Company and board of directors or other governing body of each of the entity members of the Provost Group have each unanimously approved the Business Combination Agreement.  The consummation of the transactions contemplated by the Business Combination Agreement is subject to certain regulatory approvals and other customary closing conditions.   The parties have agreed to use their reasonable efforts to complete the transaction on or before January 31, 2008.

The foregoing description of the Business Combination Agreement is qualified in its entirety by reference to the terms and conditions of the definitive Business Combination Agreement.

Item 7.01.   Regulation FD Disclosure.

On October 15, 2007, the Company issued a press release announcing the formation of the Combined Business. A copy of the press release is attached as Exhibit 99.1 to this report.

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Item 9.01.   Financial Statements and Exhibits.

(d) Exhibits

                99.1         Press release dated October 15, 2007.

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SIGNATURES

                Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

		REGIS CORPORATION
Date:	October 12, 2007	/s/ Eric Bakken
		Name: Eric Bakken, Title: Secretary

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release dated October 15, 2007.

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EX-99.1

EXHIBIT 99.1

CONTACT:	REGIS CORPORATION:
	Mark Fosland — Vice President, Finance
	(952) 806-1707
	Alex Forliti — Director, Finance — Investor Relations
	(952) 806-1767

For Immediate Release

REGIS TO MERGE CONTINENTAL EUROPEAN FRANCHISE OPERATIONS INTO FRANCK PROVOST GROUP

—Regis to Own 30 Percent Stake in New Company—

MINNEAPOLIS, October 15, 2007 — Regis Corporation (NYSE:RGS), the global leader in the $150 billion hair care industry, announced today that it has entered into an agreement to merge its continental European franchise salon operations into Franck Provost Salon Group, creating the largest hair salon company in Europe. This transaction is expected to create significant growth opportunities for Europe’s top salon brands.  The Provost management structure has a proven platform to build and acquire company-owned stores as well as a strong franchise operating group that is positioned for expansion.  Regis Corporation will maintain a 30 percent interest in the merged entity and the current Provost management team will oversee all of the operations of the combined merged companies.  Regis’ operations in the United Kingdom would not be part of the combination.

The consolidated merged companies will operate over 2,200 company-owned and franchised salons.  Revenues for the combined companies will be over $200 million with system-wide revenues in excess of $900 million.

The Franck Provost Group currently operates approximately 200 company-owned salons and 400 franchise locations with annual revenues of $140 million and system-wide revenues in excess of $300 million. The Franck Provost Salon Group, led by its founder and Chairman, Franck Provost, Marc Aublet, President and Chief Operating Officer, and Daniel Gagnor, Chief Financial Officer, has been operating salons in France and the European continent since 1975.

“Today, our continental European operations are very healthy with strong and consistent cash flows; in fact, fiscal 2007 results were above plan.  However, to grow the business and to capture a larger share of the European market a platform is needed to support a company-owned strategy.  There are significant acquisition opportunities and there are many shopping malls in which we should have company-owned locations.  Also, our current franchisees need an exit strategy,” commented Paul D. Finkelstein, Chairman and Chief Executive Officer of Regis Corporation.  “The Provost returns are spectacular. Having a 30% minority ownership with a strong local management team in this much larger entity with tremendous growth opportunities is the optimal strategy to become a market leader in Europe and drive shareholder value.”

The transaction is expected to close in January, 2008 and is subject to obtaining applicable regulatory and other approvals.  Regis does not expect the proposed transaction to have a material impact on its fiscal 2008 operating results.  Additionally,  further detail of this transaction will be provided on the first quarter earnings conference call scheduled for October 22, 2007 at 10:00 a.m. Central Time.

About Regis Corporation

Regis Corporation (NYSE:RGS) is the beauty industry’s global leader in beauty salons, hair restoration centers and cosmetology education. As of June 30, 2007, the Company owned, franchised or held ownership interests in over 12,400 worldwide locations.  Regis’ corporate and franchised locations operate under concepts such as Supercuts, Jean Louis David, Vidal Sassoon, Regis Salons, MasterCuts, Trade Secret, SmartStyle, Cost Cutters and Hair Club for Men and Women.  In addition, Regis maintains ownership interests in Empire Education Group and various other salon concepts such as Cool Cuts 4 Kids, and the Beauty Takashi and Beauty Plaza concepts in Japan.  System-wide, these and other concepts are located in the U.S. and in eleven other countries in North America, Europe and Asia. Regis also maintains a 50 percent ownership interest in Intelligent Nutrients, a joint venture that provides a wide variety of certified organic products for health and beauty.  For additional information about the company, including management’s current financial outlook and a reconciliation of non-GAAP financial information, please visit the Investor Information section of the corporate website at www.regiscorp.com. To join Regis Corporation’s email alert list, click on this link:  http://www.b2i.us/irpass.asp?BzID=913&to=ea&Nav=1&S=0&L=1

            This press release contains “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 competition within the personal hair care industry, which remains strong, both domestically and internationally; price sensitivity; changes in economic conditions; changes in consumer tastes and fashion trends; labor and benefit costs; legal claims; risk inherent to international development (including currency fluctuations); the continued ability of the Company and its franchisees to obtain suitable locations for new salon development; governmental initiatives such as minimum wage rates, taxes and possible franchise legislation; the ability of the Company to successfully identify, acquire and integrate salons that support its growth objectives; the ability of the Company to maintain satisfactory relationships with suppliers; or other factors not listed above. The ability of the Company to meet its expected revenue growth is dependent on salon acquisitions, new salon construction and same-store sales increases, all of which are affected by many of the aforementioned risks. Additional information concerning potential factors that could affect future financial results is set forth in the Company’s Annual Report on Form 10-K for the year ended June 30, 2007. 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.