In a statement to the ASX on Tuesday, Vocus said: "Following an accelerated period of due diligence, EQT has decided not to proceed with the transaction outlined in the indicative proposal. Accordingly, discussions with EQT in relation to the indicative proposal have now ceased."
A few days back, energy retailer AGL indicated it had made an offer for Vocus but then backed out when the terms of due diligence could not be agreed.
Vocus has been the target of takeovers before. In June 2017 a report said TPG Capital could team up with Vocus founder James Spenceley to examine a takeover in the event that the equity firm's bid for Fairfax Media did not come off.
Vocus has been hit by the ever-decreasing margins of its broadband business as the NBN Co has made it difficult for RSPs to turn a profit. Its retail business was written down by about $1 billion in 2017.
Vocus managing director and chief executive Kevin Russell said: "As we said in our interim results on 27 February, we are in the early stages of a business turnaround.
"We have great confidence that our strategy will deliver significant value to our shareholders in the medium to long term. There is growing demand for our strategically valuable network assets and we have a substantial opportunity to gain market share in Vocus Networks, which is the core of our business.
"We thank EQT for their interest in Vocus and the board and management team will now be able to focus all of their attention on realising the opportunity that we have ahead of us."
The company reiterated its FY2019 guidance, with underlying EBITDA expected to come in between $350 million and $370 million.