U.S.-based Omnicom Group Inc. (OMC) and French rival Publicis Groupe SA (PUB.FR) have called off their $35 billion merger, noting "difficulties in completing the transaction within a reasonable time frame," the Wall Street Journal reported. The megamerger would have formed the world's biggest advertising agency.

The deal, presented in July, started unraveling after Omnicom chief executive John Wren revealed doubts about it -- noting tax complications -- at an earnings call last month, according to Reuters.

"The challenges that still remained to be overcome, in addition to the slow pace of progress, created a level of uncertainty detrimental to the interests of both groups and their employees, clients and shareholders," Wren and Publicis CEO Maurice Levy said in a joint statement Thursday. "We have thus jointly decided to proceed along our independent paths. We, of course, remain competitors, but maintain a great respect for one another."

The deal was abandoned due to several sticking points, including the companies' failure to agree on a chief financial officer who would have taken charge of implementing the deal, a source close to Publicis told Reuters. Neither company will pay a termination fee.    

Another source said cultural differences between the two firms proved to be too tough to hurdle as tensions regarding leadership and strategy grew, Reuters reported. A third source said the boards of the two companies met Thursday to unwind the deal. The three sources -- one of whom said that "big egos" were involved -- requested anonymity because they're not authorized to discuss the matter publicly, the news agency added.

According to the Journal, the deal, described as a "merger of equals," had been challenged by battles over position and power, including difficulties in getting tax and other regulatory approvals, people familiar with the matter said.

Announced with plenty of fanfare, the megamerger was orchestrated to bring each firm extra weight in competing with juggernauts like Google and Facebook, which dominate digital advertising, which accounts for almost a quarter of global marketing spending, Reuters reported.

The deal would have led to the world's biggest ad holding company by revenue as it combined advertising agencies such as BBDO, DDB, Saatchi & Saatchi, TBWA and Leo Burnett, public relations firms like FleishmanHillard and Ketchum as well as digital ad agencies including DigitasLBi and Razorfish, the Journal noted.

The merger called for a 50-50 ownership split of the equity in the new company, Publicis Omnicom Group, with Wren and Levy operating as co-CEOs for 30 months from the closing, according to Reuters.

The crucial choice of chief financial officer had been a particular sticking point.

According to a person familiar with the matter, differences over the position were so stark that last November, Omnicom executives told an analyst in the U.S. that its CFO, Randy Weisenburger, would get the job, while Publicis executives told another analyst that its CFO, Jean-Michel Etienne, would grab the position, the Journal reported.

"We both have strong personalities and we both have strong corporate cultures but there was no one factor," Wren said.