The American company behind a proposed huge Las Vegas-style “Sphere” entertainment venue in east London has withdrawn its plans.

Madison Square Garden Entertainment (MSG) said it could not continue to participate in a process that was “merely a political football between rival parties”.

In a letter to the Planning Inspectorate, seen by the PA news agency, MSG said it was “extremely disappointing” that Londoners would “not benefit from the Sphere’s groundbreaking technology and the thousands of well-paying jobs it would have created”.

In December, Housing Secretary Michael Gove used his powers to “call in” and review the rejection of planning permission by London Mayor Sadiq Khan for the 21,000-capacity, 300ft-tall sphere in Stratford, east London.

After spending millions of pounds acquiring our site in Stratford and collaboratively engaging in a five-year planning process with numerous governmental bodies, including the local planning authority who approved our plans following careful review, we cannot continue to participate in a process that is merely a political football between rival parties

However, Sphere Entertainment, a sister firm to MSG, said it had written to Mr Gove advising him of the company’s plan to withdraw its application for a London sphere and to decline to participate in the call-in process.

A spokesperson for the firm added that it was committed to working with “forward-thinking cities around the world” who are “serious” about bringing the project to their communities.

MSG’s letter to the Planning Inspectorate read: “On behalf of both Stratford Garden Development Limited and Sphere Entertainment, I write to confirm that we are officially withdrawing our application from the Planning Inspectorate process.

“After spending millions of pounds acquiring our site in Stratford and collaboratively engaging in a five-year planning process with numerous governmental bodies, including the local planning authority who approved our plans following careful review, we cannot continue to participate in a process that is merely a political football between rival parties.”

MSG had wanted to build its sphere venue in Stratford, with plans to illuminate it on the outside and have the highest resolution LED screen on Earth, along with immersive sound systems to host concerts, shows and sporting events.

The 4.7-acre site was bought by the firm having been left empty since it was last used as a temporary coach park during the 2012 London Olympics.

But Mr Khan ruled in November that the Sphere, following New York-based firm MSG’s planning application to the LLDC, would not be allowed to be built.

The Labour mayor said the venue would cause “significant light intrusion resulting in significant harm to the outlook of neighbouring properties, detriment to human health, and significant harm to the general amenity enjoyed by residents of their own homes”.

The mayor went on to say it would be “bulky” and “unduly dominant” and would not “constitute good and sustainable design”.

Residents living near the proposed development site had reportedly said they were “insulted” after developers MSG allegedly offered blackout blinds as a way of mitigating the glow from the images emitting from the orb-like structure.