Sinochem was not immediately available for comment, while Pirelli declined to comment.
Sources had previously told Reuters that the government was concerned about Sinochem's growing influence on Pirelli, as the proposed pact would have allowed the Chinese group to appoint more board members and potentially choose Pirelli's future CEOs.
Founded in 1872, Pirelli is one of Italy's most storied companies.
CHANGES NEEDEDMeloni's government refrained from imposing even tougher conditions on Sinochem, including blocking its voting rights in Pirelli.
The Chinese group earlier this year confirmed its plans to remain a long-term investor in Pirelli.
Persons:
China's Sinochem, Marco Tronchetti Provera, Giorgia, Sinochem, Rome, Camfin, Giorgio Bruno, Tronchetti Provera, Alvise Armellini, Giuseppe Fonte, Giulio Piovaccari, Sandra Maler
Organizations:
Beijing, tyremaker Pirelli, Camfin, Pirelli, Reuters, Big, Ferrari, Porsche, BMW, Formula, Initiative, Thomson
Locations:
Beijing ROME, China, Beijing, Italy, Europe, Rome, Milan