A Qatari fund has dropped plans for a £10.6 billion bid for British retailer J Sainsbury.
Delta Two, which owns a 25 per cent stake in Sainsbury, blamed worsening credit markets and the cost of winning support from the firm's pension trustees.
Shares in Sainsbury, Britain's third-biggest supermarket group, tumbled as much as 20 per cent in early trading today.
The deal is the biggest transaction so far involving a British company to fall victim to the problems in global credit markets sparked by poor quality US mortgage loans.
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It comes after confectioner Cadbury dropped plans to sell its North American drinks unit and pubs group Mitchells & Butlers put a planned property spin-off on hold.