Blackstone Group, the private equity firm said to be on the verge of backing Tom Hicks in his last ditch bid to retain control of Liverpool FC in the face of fierce fan opposition, is understood to have ended all talks with the Texan.

Hicks had approached GSO Capital Partners, the debt restructuring arm of the private equity group, to secure the funds required to repay the £237m outstanding to the Royal Bank of Scotland in the middle of next month and remain in control of the club.

It had been reported that a £280m, two-year package had been agreed in principle. But it is understood that, although talks took place between GSO and Hicks, they ended without a firm offer on the table. The Guardian has learned that GSO has now walked away and there is no chance of the Blackstone subsidiary lending Hicks the money. Liverpool fans' groups over the weekend made clear the depth of their hostility to the idea that Hicks could be bailed out by GSO, effectively buying him more time to find a new investor willing to pay a premium on the £218.9m the Americans paid for the club in 2007.

Hicks met with the club's chairman, Martin Broughton, and the rest of the Liverpool board last week to outline his plan. RBS, which throughout has maintained that it wishes to find a solution that is in the best long term interests of the club, would nevertheless have no further say in the matter if its loan was repaid in full.

Hicks and George Gillett put Liverpool up for sale in April, with RBS parachuting in Broughton to lead the sale process. But despite a series of high profile approaches, from Rhone Capital and Kenny Huang, no proper bid was ever lodged.

Hicks had hoped that the funding would allow him to take full control, pay down the debt and provide funds for players. Now that Blackstone has walked away, it leaves him desperately searching for a replacement loan before the mid-October refinancing deadline. It would also see Gillett's 50% stake diluted, with the Colorado-native staying at Liverpool in an inactive role.

A first attempt by Hicks to refinance the debt was rejected earlier this year by the Liverpool board to allow Barclays Capital to continue the ongoing search for a buyer. If Hicks approached the board with a new proposal, it is believed that they would also look to block it, although lawyers are split on whether they would be able to do so under company law.