South Africa’s MTN walked away from a potential combination with India’s Reliance Communications on Friday, scuppering the creation of an emerging market telecoms giant and damaging the standing of corporate India.

“Owing to certain legal and regulatory issues, the parties are unable to conclude a transaction,” MTN said in a statement issued to the Johannesburg stock exchange after it closed. “Accordingly, it has been mutually decided to allow the exclusivity agreement [on tie-up talks] to lapse.” Reliance issued the same statement.