But the company said discussions with the Evening Standard owner are continuing with an announcement expected "very shortly".
The results today (24 March) revealed IN&M's revenues had deteriorated by 14.9% between 2008 and 2009, to €1.26bn.
It made an operating profit of €177.2m, but took charges on exceptional items of €145.8m, which led to a pre-tax loss of €31.4m.
The two titles Lebedev covets suffered a 33% advertising revenue drop in sterling terms.
IN&M's UK division, which houses these titles along with Northern Ireland papers the Belfast Telegraph and the Sunday Life, suffered an operating loss before exceptional items of €6.9m, after revenue dropped 29% to €122.7m.
IN&M said The Independent and IoS reduced their losses, due to major cost savings put in place at the end of 2008, and the service-sharing agreement with the Daily Mail and General Trust implemented in the first half of 2009.
Providing a commentary on trading since the year end to 19 March, IN&M said revenues were ahead of the same period 2009 by 5.8%, reflecting an improvement in exchange rates.
IN&M sold a number of assets last year as it battled to generate cash, but only made a €5.4m net gain. The disposals included its INM Outdoor subsidiary in South Africa, and stakes in Indian publisher Jagran Prakashan and bingo operator Cashcade.
The company made a €2.4m payment to Sir Anthony O'Reilly when he retired as a director and chief executive with effect from 7 May 2009, covering compensation and pension contributions.