China's largest automaker SAIC Motor has terminated an agreement to acquire stakes in troubled CAR Inc., the country's largest car rental company.

SAIC Motor HK Investment, a wholly-owned unit of SAIC, decided to end the deal after disagreement during negotiations over the transfer of equity, the car maker announced in a filing (in Chinese) on Monday.

SAIC HK and two substantial shareholders of CAR – UCAR Inc. and Amber Gem – signed a preliminary deal on July 2, in which SAIC HK agreed to take up to 28.92 percent in stake in CAR for about 250 million U.S. dollars. UCAR Inc. and Amber Gem were interested in roughly 20.87 percent and 14.76 percent of CAR Inc.'s total issued share capital respectively.

The deal would have helped the car rental platform recover more quickly from the impact of the COVID-19 pandemic and SAIC expand its footprint in the mobility market, analysts from China International Capital Corporation said.

CAR Inc. in late May revealed Daimler's Chinese partner BAIC's intent to buy 21.3 percent of the company. However, SAIC won out as BAIC has yet to complete a due diligence review of the company.

CAR Inc. was hit hard by the pandemic. Its first quarter revenue sank by 28.3 percent year on year and the company recorded a net loss of about 26.9 million U.S. dollars. Shares of CAR Inc. were down 4.87 percent by Monday 11:58 a.m. Beijing time.