But Grosvenor and Stanhope have now pulled out of the Meridian Delta consortium, reportedly leaving scientific research charity the Wellcome Trust as the main bidder for the south London site.

The duke is Britain's richest landowner

A spokesman for the consortium said: "The two companies decided not to contribute to the bid. They have pulled out.

"I can confirm that Quintain Estates and Lend Lease will be submitting a bid for the Dome and associated land. I have no comment on why Grosvenor and Stanhope are not going ahead."

In an interview with the Financial Times, Grosvenor and Stanhope said their decision was linked to "the changing commercial and economic environment".

'Wonderful gesture'

Meanwhile the man overseeing the Dome's closure has denied press reports that he suggested moving the structure to New York.

A report in The Times said David James suggested to Tony Blair it would be "a wonderful gesture" to offer the Dome as a cover for the World Trade Centre salvage operation at Ground Zero.

Mr James was reported to have said: "It would be a marvellous means of seeing the Millennium Dome having a meaningful purpose in life."

Legacy wanted to create a site for hi-tech businesses

The paper said Ground Zero needed to be covered before the onset of winter, and to protect it from being turned into "a ghoulish tourist attraction".

But on Saturday a spokesman for Mr James said: "David James categorically denies that he has advised the government that the Dome should go to New York.

"Such a proposal would be completely impractical and could only be contemplated within the sphere of science fiction."

Meanwhile the setback to the Meridian Delta consortium could pave the way for the Wellcome Trust's bid to turn the south-east London site into a biomedical research centre.

In February, Legacy plc lost its preferred bidder status for taking over the Millennium Dome.

The company, which bid �125m for the site, wanted to turn the site into a hi-tech business centre.

The site is costing millions to maintain and protect while the government decides what to do with it. No decision is thought to be imminent.