The Edinburgh-based Le Bistro was expected to merge with the Glasgow-based Azure Support Services.
The aptly-named Azure has a contract for the catering at Rangers Football Club.
Le Bistro turned over £7m last year.
Liz McAreavey, who owns Le Bistro, will be director of development with Azure, which is keen to move into the corporate catering sector.
The future of the Le Bistro name has not yet been decided but it could be used as the corporate event brand for Azure.