Negotiations for the takeover of cycling team Euskaltel Euskadi by Spanish Formula One driver Fernando Alonso have collapsed, the Basque squad said Monday.

"It is a sad day for Euskaltel and the team, after the expectations generated by the agreement in principle reached in late August and public statements made at the time by Fernando Alonso and his representatives," the team said in a statement.

In the wake of the failed talks, the statement added, "Euskaltel is forced to sadly return to an orderly shutdown process of the project."

The team announced Aug. 20 that it would disband at the end of this season after failing to secure a second sponsor for 2014.

The team's sponsor, Spanish cable operator Euskaltel, doubled its support from 3.5 million euros ($4.67 million) to 7 million euros this year, but the company was unable to continue that level of funding into 2014, the squad said last month,

On Sept. 2, however, Alonso, a two-time F1 champion, said on his Web site that he planned to buy Euskaltel Euskadi and support the team for the "medium to long term."

He also said he would honor contracts with the squad's 14 riders and other staff.

"Euskaltel has devoted all its efforts to reaching an agreement, doing everything on its part, without any restriction, either economically or whatsoever," the team said Monday.

The two sides were not able to fulfill the terms of the "road map" they established in the Aug. 31 agreement in principle, Euskaltel said.

With 17 consecutive seasons, Euskaltel Euskadi is the oldest team in elite cycling and its disappearance will leave Movistar as the only Spanish squad on the 2014 UCI World Tour circuit. EFE