Germany's Social Democrats (SPD) chairman Martin Schulz announced on Friday that he would not pursue ministerial post in the next German government, including the foreign minister.
Having ruled out entering a Merkel-led coalition government in the immediate aftermath of the election, Schulz made a U-turn after the chancellor's attempt to build an unorthodox coalition with the pro-business Free Democratic party and the Green party collapsed.
"I hereby declare my decision not to join the federal government and at the same time I sincerely hope that this will end the personnel debates within the SPD", said Mr Schulz.
The rare public broadside at his comrades came after SPD and Merkel's conservative CDU/CSU bloc announced a hard-fought coalition deal on Wednesday that could see Schulz claim the Foreign Ministry.
Citing unidentified party officials, dpa said that Merkel's Christian Democratic Union, its Bavaria-only sister party the Christian Social Union and the Social Democrats overcame the last hurdles to a coalition deal on Wednesday. He also said Andrea Nahles, the party's parliamentary leader, would take over as the Social Democrats' chairwoman.
He added that his personal ambitions "must be placed behind the interests of the party".
The head of the Social Democrats' youth wing, who is campaigning against the new coalition, said party members should give up fighting about who does what job and concentrate on debating whether the party enters the government.
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A Forsa poll had indicated that nearly three-quarters of Germans thought it would be wrong for Schulz to become foreign minister.
The job is now held by Sigmar Gabriel, who handed the party leadership to Mr Schulz a year ago and has become one of Germany's most popular politicians since taking on the role of foreign minister.
"The only thing left, really, is remorse over how disrespectful we've become with one another in our dealings and how little someone's word still counts", Gabriel said.
Last September, the Social Democrats suffered their worst election result in decades, but remained the second-largest party in parliament. Gabriel himself surrendered the party chairmanship to Schulz in January 2017. He reversed course, however, after Merkel's coalition talks with two smaller parties collapsed in November.
Schulz was Merkel's defeated challenger in September.
He reversed that position under pressure in November after Merkel's talks with the Greens and Free Democrats to form a multi-party government collapsed in acrimony.