The planned $45 billion merger between EADS and BAE Systems is off, the companies confirmed on Wednesday afternoon in London. Sources say the German government blocked the deal.

“We are obviously disappointed that we were unable to reach an acceptable agreement with our various government stakeholders,” BAE Systems chief executive Ian King said in a statement. “It is a pity we didn’t succeed, but we tried,” said Tom Enders, chief executive of EADS.

EADS and BAE had a deadline of 5pm GMT Wednesday to either file a merger plan, seek an extension or walk away from the deal.