Ole Madrids are to abandon their legal action against New Zealand Soccer.

Madrids general manager Dave Wilson said the Porirua franchise had decided not to fight their omission from the new national league because it was not in the sport's best interests.

Wilson denied the about-face had come because Madrids' High Court case was crumbling.

"This is not about copping out. This is about where soccer is in this country and when you look at the negative things happening around the game, the last thing they needed was another negative," Wilson said.

"I think it is important to say our case was very strong. We believe we should have been in the league but with what has been happening in recent times, it is not in the Madrids' interests to be putting NZ Soccer under more pressure."

NZ Soccer chief executive Bill MacGowan welcomed the development.

"We're pretty happy about their decision," he said. "We were pressing ahead with the league regardless but it takes a potential issue away."

Wilson said Madrids would consider another bid for inclusion in the franchise-style league, which is set to replace the traditional club competition from mid-October, when "we are wanted".

He said the Madrids' feeder club, Western Suburbs, would now throw their weight behind the successful team Wellington franchise.