Spain's Franco negotiated to join the Axis Powers on condition to take some British and French colonies and territory. Why didn't Hitler agree?

by takatori

German support, equipment, planes and pilots were arguably critical to General Franco's Nationalist victory in the Spanish Civil War, yet the alliance dissolved prior to the start of WWII in Europe, with Spain sitting on the sidelines throughout.

Why didn't Spain enter an alliance with the Axis Powers, and why didn't the Axis Powers work harder to gain their support?

My understanding is that negotiations were entered into, yet fell apart over questions of how to divide French and British territories in the aftermath of an eventual Axis victory.

Why didn't Germany and Italy agree and add Spain to their alliance?

Or if the premise is mistaken, what was the reason no alliance materialized?

Or was there an alignment and support falling short of a military alliance, and why was this not a stronger alliance?


Bonus question: had Spain been a member of the Axis, need for control of the Mediterranean would have made Gibraltar and possibly Ceuta, Melilla, and the Canaries strategically important to the Allied war effort. Did the Allies have contingency plans for a Spanish entry into the war on the Axis side?

TheGreatSchnorkie

Hitler wanted Franco to participate more, but Franco managed to decline in a polite fashion. When Hitler was winning, Franco started to make promises of military support and even contributed the "Blue" Division to fight on the Soviet front. However, when the proverbial writing on the wall of Hitler's loss was evident, Franco knew his country was in no position, after a devastating civil war, to fight the Allied powers and feared losing his own position he had so recently won.

And he was right. Franco ruled up until his death in like 1973. We all know Hitler didn't do so hot in the Spring of '45.