The Australian midfielder was all set to be Sven Goran Eriksson's latest big name signing of the summer until the surprise denouement.
"Bresciano had asked us a while back for this experience in England, but he is nonetheless content at Palermo and is more ready than ever to work with Coach Stefano Colantuono, even if he may be a little bitter."
It's believed the transfer crumbled when Manchester City insisted on spreading the £5.4m over a number of instalments starting from September.
The Rosanero wanted all the cash upfront to pour back into the transfer market and so the two clubs abandoned negotiations this evening.
"City are not respecting the initial terms of our agreement. The economic plan they proposed today is not the same we had dictated and if the club does not make a step backwards before this evening is over, I will no longer give my blessing to the transfer. We are not willing to wait any longer. Rules must be respected," continued Foschi.
"Bresciano should be grateful to the club, because they gave him the opportunity to follow this dream. It was not our fault it didn't come true. I am sure Mark will work hard like the professional he is."