US investment firm RedBird Capital has pulled out of the running to buy The Telegraph after previously agreeing to a deal worth around £500 million.
It throws uncertainty over the future ownership of the 170-year-old newspaper business following a tumultuous takeover process.
RedBird said in May that it had reached an in-principle agreement to become the controlling owner of the business.
But on Friday, it said it had withdrawn its bid for the Telegraph Media Group.
A spokesman said: “We remain fully confident that the Telegraph and its world-class team have a bright future ahead of them and we will work hard to help secure a solution which is in the best interests of employees and readers.”
The Telegraph has been the subject of a potential takeover for more than two years.
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