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The Email that I am composing to the US
sales manager goes like this.

First, I will show how much thankful that we are,
and provide him with supporting reasons that we
cannot proceed any further on this matter.

Finally I will use this following sentence,
"We deeply regret to inform that we cannot
pursuit your proposal any further." and ask him
to send our sincere regards to his department
manager who were present at the web meeting.