Singapore state investor Temasek has pulled out of the running to buy Nasdaq's 31 percent stake in the London Stock Exchange, the Daily Telegraph reported on Thursday.
The United States Nasdaq exchange said last month it would sell its stake in the LSE after a failed takeover attempt.
Temasek was not immediately available for comment.
The Financial Times reported a group of Italian financial foundations were about to shelve plans to bid for up to 10 percent of the LSE, after the exchange's management told them such a move would be seen as unfriendly.
Attempts to reach two of the Italian parties involved for comment were unsuccessful.
Germany's Deutsche Boerse also said on Wednesday it was not interested in buying the stake, leaving the state-owned Qatar Investment Authority in the leading position for the deal.