Merger Halted Between VG Systems, Spectragraphics

VG Systems and Spectragraphics Corp. have abandoned their merger talks. The two companies, competitors in making computer-aided design hardware, said the benefits expected when they first agreed to merge in October proved elusive on closer inspection.

VG Systems is based in Woodland Hills and reported annual sales of about $25 million. Spectragraphics, based in San Diego, reported annual sales of about $20 million. Both companies are privately held.