The U.K. Listing Authority denied the request, triggering an escalating slide in the fund's value, which has fallen 90 percent in the past year, The Times of London reported.

Four British banks -- HBOS, Lloyds TSB, the Royal Bank of Scotland and HSBC -- and the National Australia Bank are positioned to take over the fund, which has a net debt of $360 million.

The banks are negotiating to arrange a debt for equity swap which would allow them control of the fund's equity in exchange for a debt reduction to zero, The Times said.