Other buyers are being sought for Scunthorpe's British Steel plant to try to safeguard thousands of jobs.
The Insolvency Service has spent two months locked in exclusive talks with the Turkish company Ataer Holdings, but this has come to an end and a deal has yet to be agreed.
Some 5,000 jobs are directly at risk in Scunthorpe along another 20,000 in the supply chain.
While discussions with Ataer are continuing, discussions with other parties who have expressed continued and renewed interest in acquiring the whole British Steel business will now be possible.
Ataer, which invests funds for the Turkish Armed Forces Assistance Fund or Oyak, already owns nearly 50% of Turkey's biggest steel producer Erdemir.
However, there has been criticism that the company is too close to the Turkish government and lacks accountability.
British Steel was put into compulsory liquidation in May after talks between previous owners Greybull and the Government collapsed, leading the business to be run by the Official Receiver.
Previous reports had suggested that Oyak wants to buy British Steel as the first step to buying up steel assets across the world.