Liverpool co-owner Tom Hicks has ended negotiations with Dubai International Capital (DIC) over acquiring a 49% stake in the club.
Hicks says he will explore other options on the ownership of the club
DIC had earlier announced it was in advanced talks to buy a stake in the Anfield side.
But in a statement on the Liverpool website, Hicks said: "I have decided to terminate further discussions with DIC.
"I and my colleagues will continue to explore a number of other options with regard to the ownership of the club."
Talks had been taking place between DIC and Hicks about how a joint relationship would work.
George Gillett, Hicks' co-owner, is understood to have agreed in principle to sell 49% of his 50% stake to DIC, and the other 1% to Hicks to give the Texan a controlling interest.
DIC have accepted that Hicks, co-owner of Kop Football (Holdings) Limited, will not sell his share in Liverpool in the near future, but would insist on a clause giving them first refusal to buy his stake.
Hicks added: "DIC made it clear that if they invested in the club, they would want it to be managed by committee.
"It is clear to me that such a committee approach would not be in the best interest of Kop, of the club or of the club's loyal and passionate supporters."
Hicks and fellow American Gillett took control in a deal worth £218.9m in February 2007. But their own relationship has broken down and the pair - Hicks in particular - have been the target for strong criticism from supporters.
It is believed Gillett is willing to sell but the situation is further complicated by an agreement between him and Hicks that means one cannot sell his share without the agreement of the other.
But BBC Radio 5 Live's football correspondent Jonathan Legard understands that DIC will not be deterred from their interest in Liverpool.
"DIC are not discouraged and the show will go on," said Legard. "There are plenty more twists and turns to come."