Oilfied services provider Halliburton Co and smaller rival Baker Hughes Inc announced the termination of their $28-billion merger deal on Sunday after opposition from U.S. and European antitrust regulators.

The tie up would have brought together the world’s No. 2 and No. 3 oil services companies, raising concerns it would result in higher prices in the sector. It is the latest example of a large merger deal failing to make it to the finish line because of antitrust hurdles.

“Challenges in obtaining remaining regulatory approvals and general industry conditions that severely damaged deal economics led to the conclusion that termination is the best course of action,” said Dave Lesar, chief executive of Halliburton.

The contract governing Halliburton’s cash-and-stock acquisition of Baker Hughes, which was valued at $34.6-billion when it was announced in November 2014, and is now worth about $28-billion, expired on Saturday without an agreement by the companies to extend it, Reuters reported earlier on Sunday, citing a person familiar with the matter.

Halliburton will pay Baker Hughes a $3.5-billion breakup fee by Wednesday as a result of the deal falling apart.

The U.S. Justice Department filed a lawsuit last month to stop the merger, arguing it would leave only two dominant suppliers in 20 business lines in the global well drilling and oil construction services industry, with Schlumberger NV being the other.

“The companies’ decision to abandon this transaction – which would have left many oilfield service markets in the hands of a duopoly – is a victory for the U.S. economy and for all Americans,” U.S. Attorney General Loretta Lynch said in a statement on Sunday.

The European Commission also previously expressed concerns that the deal might reduce competition and innovation.

The Justice Department and Federal Trade Commission, which enforce U.S. antitrust law, have filed lawsuits to stop an unusually high number of deals in the past 18 months. Lynch said last month that the number of big and complex deals being proposed made it “a unique moment in antitrust enforcement.”

The collapse of Halliburton’s acquisition of Baker Hughes comes as both companies struggle to cope with the impact lower energy prices are having on their clients.

Last week, Baker Hughes reported a bigger-than-expected first-quarter loss and warned that the rig count globally would drop steadily through the end of the year because of fewer new projects.

Halliburton said last month it cut more than 6,000 jobs in the first quarter as revenue slumped 40.4 per cent and it took a $2.1-billion restructuring charge mainly for severance costs and asset write-offs.