FCS LABORATORIES &lt;FCSI> TERMINATES DEAL TALKS

  FCS Laboratories Inc said merger
  discussions with an unnamed privately-held company in the
  health care field have ended without an agreement.
      The previously announced negotiations began last August,
  the company said.
      "It's disappointing to spend so much time on these
  negotiations and have them fail," said FCS chairman Nicholas
  Gallo III. "But the discussions could not produce a deal
  acceptable to our board in the context of the company's
  stronger financial position today as compared to six months
  ago."
      Gallo said FCS will stop actively seeking potential merger
  partners, but will respond to serious inquiries.
      "We are determined to follow our plan to restore this
  company to profitability," he said. "To continue actively
  searching for potential acquirers inherently forces us to
  postpone the implementation of critical decisions which are
  part of the plan."
      The company, which has 4,475,930 common shares outstanding,
  reaffirmed it expects to be profitable in the second half of
  the fiscal year ending September 30, 1987.
  

