Failed applying updates in Windows Server 2016

I am trying to install the 2021-04 cumulative update for Windows Server 2016 (KB5003197) to a standalone server that runs a SAP application. The server accepted Security Stack Update (KB5001402) and it had no issue. Other servers accepted these updates without any issue and the configuration is the same. The only GPO active is to Install Automatic Updates -> Disabled so the servers will not restart without consent.

I tried to install the MSU, via DISM and the server is not able to install it, it rollsbacks after restart and the EventViewer says that it failed with error 0x80070020. Microsoft says that other things are using Windows Update files and it is not able to install it. I tried to install older cumulative updates first but it is going with the same error.

After this, I tried to install from Windows Update and it cannot continue after it downloaded the update (WU is trying with 2021-05). No errors are shown in the Eventlog but these events are being written everytime WU tries to install.

Initiating changes for package KB5003197. Current state is Resolved. Target state is Installed. Client id: WindowsUpdateAgent.

Initiating changes for package KB5003197. Current state is Resolved. Target state is Staged. Client id: WindowsUpdateAgent.

Package KB5003197 failed to be changed to the Staged state. Status: 0x800f0816.

(This is an endless loop)

I have searched a lot in forums and in Microsoft Answers where only the troubleshooter is recommended.

I looked in WindowsUpdate.log after Get-WindowsUpdateLog and it shows that it is trying to download an express package and it is also in an endless loop.

The current installed updates are:

• 3192137
• 4093137
• 4509091
• 5001402
• 4535680
• 4103723

I would appreciate any guidance. Thank you.