Coventry have confirmed Manhattan Sports Capital Partners Limited have withdrawn their interest in buying the club.
In February, the American consortium agreed in principle a deal to buy the midlands outfit and take on their estimated debts of £28million.
But on Saturday, Paul Fletcher revealed his decision to resign as managing director of the club was prompted by the withdrawal of all five potential investors in the Ricoh Arena club.
Sky Blues director Joe Elliott said Manhattan's withdrawal was "bitterly disappointing" and added it was due to the current problems with the interest rate in the United States as well as the dollar's fluctuating price against the pound and the current business interests of Sheldon Yellen, the potential principle investor in the project.
Elliott added: "We thank Manhattan for their work with Coventry City and everyone at the club is very sad the deal will not be going ahead after all parties have worked so hard to complete it for the last eight months.
"Unfortunately, it is the case with business that other factors often dictate deals and this is the situation here. Coventry City could not have worked harder for this investment to progress.
"We are fully committed to finding investment for this great football club.
"There will inevitably to ups and downs along the way, as with all business transactions, but it is essential everyone associated with Coventry City remains positive and pulls together in this battle."