The Scarlets have revealed that any planned merger with their Welsh regional rivals Ospreys is "off the table."
Welsh rugby is in domestic turmoil - and discussions are now deadlocked - over so-called Project Reset.
The Scarlets and Ospreys were expected to join forces under that plan, together with a new professional team being formed in north Wales, alongside existing Welsh regions Cardiff Blues and the Dragons, in Welsh rugby's biggest domestic shake-up since the inception of regional sides 16 years ago.
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Scores of Welsh professional players' immediate futures are in limbo, with Wales' Professional Rugby Board (PRB) hoping to have thrashed out a proposal for the Welsh Rugby Union (WRU) board.
But Ospreys chairman Mike James resigned at the start of Tuesday's PRB meeting, citing the WRU's "catastrophic mismanagement" of efforts to overhaul the game.
The furious Ospreys then released a strongly worded statement claiming they were not on the verge of merging with the Scarlets.
And the PRB responded by stating a merger between Scarlets and Ospreys was "a central component" of their proposal.
In a statement issued on Wednesday, the Scarlets gave a detailed update on their position.
They confirmed that the proposed merger was driven by the regions, revealing they received "a high-level approach" from the Ospreys about it in late December.
After discussions broke down, the Scarlets say they were approached by the Ospreys again last week.
The Scarlets confirmed PRB's statement that heads of terms were "agreed and signed by the Ospreys and Scarlets" on 1 March "on terms we believe our supporters would be happy with".
The club added: "This was to be proposed at a meeting of the PRB on Tuesday afternoon, but we were told at the start of that meeting that the Ospreys had changed their mind.
"The merger is off the table."