Midea Group Co. has dropped its pursuit of Electrolux AB after finding the Swedish home appliance maker unreceptive to a deal, highlighting the persistent difficulties of Chinese takeovers.

The Chinese appliance group wasn’t able to fulfill all the demands from Electrolux and its top shareholder Investor AB, according to people with knowledge of the matter, who asked not to be identified because the information is private. The companies have been discussing terms of a potential transaction since Midea made a preliminary approach in the spring.

Electrolux and Investor AB had requested assurances on pricing and regulatory issues, with discussions coming against a backdrop of growing protectionist measures in Europe and the US — even if the business of making dishwashers and refrigerators can’t necessarily be deemed a national security risk.

The companies wanted to be sure any takeover would proceed even in the event of regulatory hurdles, the people said. They had also been seeking guarantees on jobs, governance and strategy, the people said. Investor AB, the investment vehicle of Sweden’s billionaire Wallenberg family, holds a nearly 18% stake in Electrolux and 30% of its voting rights.

Shares in Electrolux jumped in early May after Bloomberg News reported Midea’s approach. The company’s B shares fell as much as 6.8% in early trading on Thursday. The stock was down 4.9% at 9:55 a.m. in Stockholm, giving it a market value of about $3.6 billion.

While plans are on ice for now, Midea has been interested in Electrolux for years and it can’t be ruled out that the Chinese firm revisits the deal in the future, the people said. Representatives for Electrolux and Investor AB declined to comment, while a spokesperson for Midea couldn’t immediately be reached for comment.

Midea, which is based in Foshan in southern China’s Guangdong province, has been looking to pursue a friendly deal for Electrolux. The company is no stranger to overseas acquisitions, having bought a controlling stake in Toshiba Corp.’s home appliance unit in 2016. It acquired German robot maker Kuka AG a year later in a deal that triggered concerns from the German government.

The Italian government would potentially have used its existing tools to intervene if the Chinese company had tried to buy Electrolux, which has a big presence in Italy, news agency Ansa reported earlier this week.

Electrolux is in the process of laying off 3,800 workers as it seeks to cut costs and turn around its North American business. It reported first-quarter earnings that were better than expected overall, but still showed a net loss, with analysts pointing to negative cash flow.

--With assistance from Jonas Ekblom.

(Updates with shares in fifth paragrapgh, details on job cuts in final paragraph.)

Author: Aaron Kirchfeld, Manuel Baigorri and Vinicy Chan