Chelsey Withdraws Offer to Take Hanover Private

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Chelsey Direct LLC has withdrawn its offer to take Hanover Direct Inc. private due to Hanover's "worsening operations," Chelsey told Hanover in a letter last week.

Hanover, Weehawken, NJ, announced in February that it had received a nonbinding proposal from Chelsey, the company's largest shareholder, to take the catalog and DMer private.

But Hanover said in a statement Friday it had been advised May 25 that discussions between Chelsey and the Special Committee of Independent Directors concerning Chelsey's proposal to take the company private at $1.25 per share had been terminated and that, as a result, the offer had been withdrawn.

"Due to the worsening operations of the company resulting from the matters as recently reported in the company's report for the first fiscal quarter, Chelsey has withdrawn its offer," Chelsey stated in a communication to Hanover.

On May 16, Hanover reported a net loss of about $1.8 million for the first fiscal quarter ended April 1 compared with net income of about $3.1 million for the same period last year. First-quarter net revenue totaled $100.3 million compared with $89.7 million in the year-ago period.

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