The media agency is understood to have been in discussions with the confectionery manufacturer for several months, but resigned the account when a fee could not be agreed.
The business includes the Tic Tac, Nutella, Kinder Surprise, Kinder Bueno and Ferrero Rocher brands.
The company's above-the-line media spend was £12.5 million in the UK in the past 12 months, according to Nielsen Media Research.
Initiative landed the UK media planning and buying account in 1994 from Carat, which continues to handle the business in Germany, France, Belgium, The Netherlands, Spain and the Nordic region.
In October last year, Ferrero Rocher's infamous "ambassador's party" ad, devised by its in-house agency, Pubbliregia, returned to UK television screens.
More recently, the company has been advertising its Kinder Bueno chocolate bar, which launched in the UK in 2002, with its famously raunchy "you can lick my ripples" television spots through WCRS.
Ferrero's above-the-line advertising account is handled by WCRS, which consolidated its grip on the business last year when it won the £3 million creative account for Kinder Chocolate.
The agency already handled Tic Tac and Kinder Bueno. Leagas Delaney currently holds the account for Kinder Surprise.
Both Initiative and Ferrero declined to comment on the story.