The Lagardère Sports agency has pulled out of a proposed deal to manage operations at the Maracana stadium in Rio de Janeiro, Brazil.

Reports emerged last month that the agency had reached an agreement to take over the stadium, which served as a centrepiece for Brazil’s staging of football’s Fifa World Cup in 2014 and the Rio 2016 Olympic Games.

The Rio Times website had suggested that Lagardère would pay upwards of R$30m (£7.5m/€8.8m/$9.7m) to assume stadium operations at the venue until 2048.

However the agency has now backed out of a deal, citing political uncertainty in Rio. “Considering the unstable position of the government of Rio de Janeiro, Lagardère Sports believes that a possible acquisition of shares of the Maracana stadium would have a degree of legal incompatibility with the internal requirements of realisation,” Lagardère said in a statement reported by French newspaper Le Parisien.

The Maracana SA consortium, led by construction firm Odebrecht, currently manages the stadium, which has fallen into disrepair since last year’s Olympics.

Power was switched off at the Maracana in January by electric utility firm Light amid a dispute over unpaid bills. In the months since the Games, the stadium has had equipment such as copper wiring, fire extinguishers and televisions stolen from its premises.

The stadium officially reopened in March when Rio-based football club Flamengo took on Argentine side San Lorenzo in the Copa Libertadores.