Telecoms giant Vodafone is set to abandon attempts to merge its Greek business with rival Wind Hellas over concerns that the deal would not meet EU regulations, the Financial Times reported on Sunday.

The likelihood of being able to agree a deal that was satisfactory for European regulators has diminished since the plans for a merger were first explored last August, according to one person with knowledge of the talks cited by the newspaper.

Concerns relate to setting a precedent that allows a duopoly to exist in a European mobile market, according to the article published on the FT's website.

A source familiar with the situation told Reuters that a statement on the matter could come early Monday morning.

The proposed merger would give Wind, Greece's third-biggest telecoms operator, and Vodafone close to 50 percent of the market with about 4 million subscribers in Greece each.

Wind and Vodafone are struggling against cell phone market leader Cosmote, a unit of former state monopoly OTE , which has almost half of Greece's mobile phone market, with Vodafone and Wind distant runners-up.

However, the source cited by the FT said the argument of difficult market conditions was unlikely to be acceptable under competition rules.

People with knowledge of the talks, cited by the FT, said the two companies could carry on talks to share networks, which is more likely to be permitted by European regulators and would still allow some cost savings.

(Reporting by Stephen Mangan; Leslie Adler)