Hair Styles | Short, Prom & Celebrity Hairstyles | Hair Care- The Hairstyle Blog

“

Alberto-Culver cites financials

Edina-based Regis Corp. on Wednesday terminated its $2.78 billion purchase of Alberto-Culver Co.’s 3,200 Sally Beauty supply stores after Alberto-Culver’s board withdrew its support for the deal, citing concerns about Regis’ financial outlook.

Illinois-based Alberto-Culver said its board of directors unanimously withdrew support for the deal citing Regis’ revised financial forecasts as well as differences over corporate governance issues.

In a statement, Alberto-Culver noted that since the two companies announced the tentative deal in January, Regis has had two earnings shortfall announcements, raising uncertainty about its fiscal 2007 outlook.

Alberto-Culver said the two companies had “certain differences over operating and governance approaches,'’ adding it failed to get Regis to revise the parties’ proposed stock exchange ratio to make up for the “substantial reduction in transaction value to Alberto-Culver’s shareholders since Regis’ March 21 earnings shortfall announcement.'’

Regis, which operates salons such as Regis Hairstylists and Supercuts, said Alberto-Culver is obligated to pay an unspecified termination fee.

In a telephone interview, Regis Chief Executive Officer Paul Finkelstein blamed the merger break-up on differences over stock valuation. “They wanted to re-price, and our shareholders were equally vociferous in not wanting to re-price,'’ Finkelstein said. Although acknowledging Regis’ recent performance has been lackluster, Finkelstein contended, “You never price a business based on one year that has been flat.'’

,,