NEW YORK -- First New York Bank for business said its proposed takeover by Designcraft Industries has been canceled. The bank has, however, arranged for an infusion of capital.
Designcraft, a shell company controlled by the bank's
V chairman, John Catsimatidis, was to become a holding company by acquiring First New York and providing $9.75 million in capital.
$5.5 Million Pledged
Under a new reorganization plan, which specializes asset bank, which specializes in small-business services, expects $5.5 million from directors and other private investors.
Certain of those people have "indicated their willingness" to make the personal investments, the bank said, which would be augmented by a rights offering to stockholders. The proposed transaction would result in "substantial dilution of existing stockholders' interests," the bank announced.
It also said Mr. Catsimatidis, an entrepreneur whose interests include supermarkets, will remain chairman, and Eliot Robinson retains the titles of vice chairman and chief operating officer.
The president and chief executive officer, Martin
Simon, resigned and will serve
V as special consultant to Mr. Catsimatidis.