Despite club chairman David Moores nearly agreeing a £155m deal with DIC in December, which would have included the building of a new £180m stadium, the Liverpool board stalled after renewed interest from George Gillett, owner of the Montreal Canadiens ice hockey team, who met club representatives in London at the weekend.
The wavering has been interpreted as a major snub by DIC, which has now pulled out of the bidding process altogether, with chief executive Sameer Al Ansari saying: "We won't overpay for assets."
It is understood Gillett has tabled a £175m bid for the club, offering assurances he would not propose a ground share with arch-rivals Everton FC, and it is expected the deal will be finalised shortly.
Under DIC's bid, shares at the club, which is 51.6% owned by David Moores, would be worth £4,500 each, but Gillett's valuation puts the figure closer to £5,000, with Moores set to receive an additional £8m if the deal is completed.
Sheikh Mohammed bin Rashid Al Maktoum, the Emir of Dubai and a central investor in DIC, has been described as "a very angry man" over Liverpool FC's reluctance to agree a takeover, prompting the firm to withdraw from the process altogether.
Al Ansari said: "We are very disappointed to be making this announcement. DIC is a serious investor with considerable resources at our disposal.
"As businessmen, we move on. As fans, we hope that the new owners would share the same vision as we had for LFC and, of course, in realising the new stadium that is so badly needed to ensure the club can continue to compete at the highest level in the Premiership and Europe."
Gillett, who has an estimated fortune of $860m, began his career in the broadcast industry before moving into the meat business, and is the owner of sports and entertainment promotion business Gillett Entertainment Group. He once also owned a stake in the Harlem Globetrotters.
Liverpool FC has long sought a takeover in order to continue competing with Premiership rivals Chelsea FC, which was bought by Russian oil billionaire Roman Abramovich for £140m in 2003, and Manchester United, which was controversially acquired by US sports tycoon Malcolm Glazer for £790m in 2005.
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