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Dissident Chantal Group Seeks to Oust CEO, Board

June 11, 1997|From Bloomberg News

Dissident shareholders of Los Angeles-based Chantal Pharmaceutical Corp., which makes the anti-wrinkle cream Ethocyn, on Tuesday said they are seeking to oust Chief Executive Chantal Burnison and her board of directors.

"We don't want her to be CEO of the company," said California investor Peter Ting, leader of the dissidents. "We will prepare our own slate of directors."

Ting said his group is negotiating with Georgette Mosbacher to be its nominee to replace Burnison as CEO. The dissidents, who own 7% of the company's shares, include Francis Phelan, Chantal's former managing director for international operations, who left the company April 2.

Mosbacher, wife of former U.S. Commerce Secretary Robert Mosbacher, owned the La Prairie cosmetics company, which she sold in 1989.

Mosbacher spokeswoman Lyn Paulsin confirmed that the group has approached her about becoming CEO.

"It's our policy to analyze every venture very carefully before making any commitment," Paulsin said.

Burnison wasn't immediately available for comment.

Chantal gained 19 cents to close at $1.44 in Nasdaq small-cap trading. The shares reached an all-time high of $28.125 in December 1995, before questions arose about the company's accounting practices and its decision to abandon efforts to win Food and Drug Administration approval for Ethocyn.

On Monday, Chantal named actress and former cosmetics firm owner Polly Bergen as chief operating officer and one of five new directors, as it prepared to hold its first shareholder meeting in more than five years.

The company lost $6.5 million, or 36 cents a share, in the nine months ending March 31, on revenue of $7.1 million.

Chantal called a special shareholder meeting for next Tuesday in New York after a shareholder sued the company in Delaware Chancery Court for violating its bylaws, which require meetings to be held annually.

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