It appears the Wellington Phoenix football club won't be relocating to Sydney anytime soon.
Last week the Phoenix confirmed they were in discussion with "parties interested in participating in the expansion of the A-League".
It did not deny it had been involved in reported merger proposal talks with a consortium from southwestern Sydney.
However, the Sydney Morning Herald is reporting that Football Federation Australia (FFA) will block a $A16 million dollar purchase of the A-League club.
The report said the transfer of the Phoenix's licence would be rejected on the grounds of maintaining the integrity of the FFA's current expansion plans.
The A-League is planned to expand to 12 teams next year.
The current Wellington Phoenix licence expires in two years.
South West Sydney FC is keen to have a team in the A-League based at Campbelltown.
If it had gained the Phoenix's licence, the South West Sydney consortium would not have had to pay an expansion fee, which could be as high as $10 million, as part of the formal process being run by FFA.
Two new teams are due to join the A-League next year.