Citroen says it could not match Sebastien Ogier's other offers for the 2018 World Rally Championship season.
Five-time WRC champion Ogier was originally a Citroen protege but left the team at the end of the 2011 season amid a fractious relationship with team-mate Sebastien Loeb.
Citroen team principal Yves Matton said his firm had tried to sign Ogier but failed, with negotiations finally ceasing earlier in November.
"We were not able to follow the offers he received," said Matton. "We made an offer, but it was not at the right level."
Matton added that he hoped Ogier stayed in the WRC.
"For the championship it's very good value to have him," he said.
"I hope he will be part of it next season."
Ogier's future is expected to be known by the end of this month.
"I'm not playing games or teasing, I don't like to keep people waiting for this news, but there is still no announcement," he said in Australia last weekend.
"I am 99% decided, but what I can say is the decision is to stop or to stay with my current team."
Citroen currently has Kris Meeke, Craig Breen, Stephane Lefebvre and Khalid Al-Qassimi under contract for 2018, and has been discussing a part-time programme for Loeb.