Austria's microelectronics (AMS) sensor maker made a public offer to buy osram on Monday, offering 38.5 euros per share for the shares of osram, according to reports.
However, AMS decided to withdraw its offer as soon as osram had announced it because it did not see a "sufficient basis" for further talks with osram.
AMS is interested in buying osram for 38.50 euros a share and needs 4.2 billion euros (32.5 billion yuan) in temporary interim loans and capital increase to support the offer, according to osram.
As none of these financial plans has yet been implemented, osram's board believes that the likelihood of a deal happening is quite low.
Soon after, AMS said it had reviewed recent developments and found there was not sufficient basis to continue discussions with osram about the deal.
AMS is valued at about 3 billion euros, compared with osram's current market value of 3.2 billion euros, according to the news.
Osram announced on Thursday that it supports a bid by bain capital and Carlyle group to buy 100 percent of osram for 3.4 billion euros (26.3 billion yuan). The minimum acceptance threshold is 70 percent, excluding osram's own shares. The offer is valid until early September.
Osram's board and supervisory board said at the time that they would recommend shareholders accept the offer.
The board will also sell its stake in osram as part of the deal.