Japanese based games developer and publisher Sega may have scrapped their deal to merge with pachinko slot machines manufacturer Sammy Corp.

A number of major news sources are quoting a Japanese newspaper which claims the two companies have called the deal off after realising that there had been several disagreements with various aspects of the merger.

"Sega called off the talks as it became clear the combination would not provide the benefits the companies had first anticipated" said a statement issued by Sega.

The merger with Sammy Corp was the latest in a long line of possible business deals which were set to help rescue Sega from financial troubles, with other names such as EA, Microsoft and Namco all rumoured to be interested in saving the once-massive publisher.

Speculation now however is that another company may step in, with an announcement due to take place at E3 next week, with either Microsoft of Namco seeming to be highly likely possibilities in what appears to be a never-ending saga for Sega. As soon as we receive confirmation either way, we'll let you know.

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