The former Welsh Secretary, Mr Davies says he will not lead Welsh assembly Ron Davies, announced last night that he no longer wished to be Labour's candidate for leader of the Welsh assembly.
A spokesman for the troubled ex-minister said the episode on London's Clapham Common that cost him his Cabinet post would "haunt him for life" and that in a letter to his Caerphilly constituency party today he would explain his decision.
Mr Davies will say in his letter that the past few days have been "torture".
But his decision will now throw the Welsh Labour Party into chaos as they seek to find a replacement for the popular figure who had been regarded as an automatic choice as effectively Wales's first prime minister.
A spokesman for Mr Davies, who reported to police that he was robbed at knifepoint after befriending a stranger on Clapham Common, said last night he would insist nothing "illegal or improper" had occurred. The former minister is to tell his local party that he "will never understand why he allowed himself to get into the situation he did last Monday evening".
The spokesman for Mr Davies said he will make clear that those events "will haunt him for ever". But in a bid to quash speculation about a gay sex or drugs link to those events, despite Downing Street denials, Mr Davies is expected to make clear that "nothing improper or illegal" took place.
In the letter he will also make clear how much the town of Caerphilly and its surrounding area mean to him and that it is there in the weeks ahead that he will gain the strength to continue with his political career as a backbencher at Westminster.
A Labour MP, Mr Rhodri Morgan (Cardiff West), who was defeated by Mr Davies last month in the leadership contest, said: "I think Ron's decision tonight is in the best interests of the Labour Party as well as his own family. We all wish them well now that this decision has been made."
Mr Morgan confirmed that he now wanted to stand as a candidate for leadership of the Welsh Assembly.