Japanese automaker Nissan (NSANY) finds itself at a crossroads. Nissan was poised to participate in a megamerger with rival Honda (HMC), and it was a huge development when the talks were revealed late last year.

Nissan backed out of negotiations with Honda in a deal that would have created the third largest automaker in the world, the report said.

Nissan's future reportedly became the sticking point in negotiations, with Honda pushing to make its smaller competitor a direct subsidiary.

Nissan and Honda, both major automakers based in Japan, responded Wednesday to reports that a potential merger of the two companies could beat risk of being abandoned.

Nissan has ended merger discussions with Honda and is now open to working with new partners, including technology firms such as Foxconn

TOKYO — Nissan is set to call off merger talks with rival Honda, a source said Wednesday, abandoning a $60 billion-plus tie-up that would have created the world's No. 3 automaker and raising questions about how it will drive a turnaround by itself.

Even if the merger is off, Nissan remains keen on working with Honda in areas such as electric vehicles and software defined vehicles.

Nissan was deep in the trenches, with its existence at stake, but Honda's timely entry gave it a positive direction. Here's how everything went down.