CHORUS LINE, JALATE SCRAP MERGER PLAN
NEW YORK — Jalate Ltd. and Chorus Line Inc. have terminated their merger agreement.
As reported, the two Los Angeles-based firms signed a letter of intent in April to merge in a deal that would have given shareholders of Chorus Line an 80 percent stake in the combined company.
Both sides declined to comment as to why the merger fell apart.
Andrew Cohen, president of Chorus Line, told WWD, “We decided that we did not think it was in the best interest of our shareholders.”
Vinton W. Bacon, Jalate’s president and chief executive officer, said in a statement, “While we’re disappointed that our transaction with Chorus Line will not come to fruition, we remain confident that our present strategy is the correct course to return Jalate to profitability.”
Jalate’s losses widened in the first quarter ended March 31, to $119,000 from $34,000, as sales slid 12 percent to $12 million. The loss stemmed from a $398,000 nonoperating loss on equity from its 40 percent interest in Airshop Ltd., a retail Web site for teens. Jalate makes knit sportswear under the Jalate label and dresses under the Zanoni name.