The Portsmouth Supporters Trust is to hold formal talks with the administrator running the financially stricken League One club with a view to becoming preferred bidders after the former owner, Balram Chainrai, withdrew his offer for the 2008 FA Cup winners.

Chainrai's Portpin group released a statement claiming its efforts to buy Pompey had "hit a wall of rejection" due to a perceived lack of "co-operation from the administrator and other interested parties", though the Hong Kong-based businessman's decision to quit talks has been welcomed as an opportunity by fans' groups to become a community-owned club. The trust's proposal is now the only bid on the table under consideration by Trevor Birch, a partner at PKF International and joint administrator at Portsmouth.

The trust announced its proposed bid two weeks ago and has already had almost £2m pledged by supporters, with associate directors and individual "high-net worth investors" to provide a further £1m. Their proposal was bolstered further last week when Portsmouth City Council agreed a £1.45m bridging loan to the trust in the event of a commercial solution‚ namely Portpin's bid‚ "not materialising". Birch has been in regular contact with the supporters' group but will now seek to formally approve their status as preferred bidders.

"It's fair to say there's a huge amount of work still to be done but, ultimately, we wanted to be in a position to be considered preferred bidders," said Colin Farmery, a spokesman for the trust. "Trevor Birch had made it clear we were his fallback position but we are now the only bidders for the club. This is an opportunity for us to complete our bid and the moment we have all been waiting for.

"We're taking Portpin at their word that they have definitively pulled out of the running and we welcome the fact they have stated they still want to help save the club, and would be willing to work with us to make this happen. We await those talks with some interest. It is certainly in no one's interests for Pompey to be liquidated. But those fans who have pledged money to the Trust's bid now need to be ready to come up with that cash. This is a pivotal moment in the club's history but we are confident we can do what is needed to make Pompey the biggest community club of its kind in the United Kingdom."

The trust has already earmarked a prospective future budget of around £2.65m, taking in everything from wages to the running of Portsmouth's academy, and would offer £2.75m to Portpin, which has £12m in secured credit against the club and owns the stadium, for the club including Fratton Park.

While Chainrai's decision to pull out of the running was not unexpected, the timing of his announcement did prompt surprise given Birch had negotiated the departures of all the club's highly paid players and largely cleared an onerous wage bill by his self-imposed deadline of 10 August to comply with the businessman's original stipulation if his interest was to proceed. As it was, he withdrew pointing a finger at PKF, which had been called in back in February with Portsmouth's parent company, Convers Sports Initiatives, having initially slipped into administration last November.

Chainrai has since complained of a lack of enthusiasm from fans at Portpin's proposed future involvement in Pompey, and the size of the administrators' fees, among other reasons not to pursue his bid. "We are not the ones to choose PKF as administrators," claimed Portpin in a statement. "We repeatedly encouraged the administrator to find a new, willing and able buyer to take over the club.

"Unfortunately he was unsuccessful in this job and couldn't find a buyer despite his promises. Later he approached us to be his safety net to save the club as he couldn't find a buyer. We agreed in the effort to avoid liquidation of the club. We welcome and will assist anyone, including the supporters' trust, to try and save the club in the coming days."

The departures of the likes of Dave Kitson, Tal Ben Haim and Liam Lawrence left the manager, Michael Appleton, with nine first-team debutants for Tuesday's 3-0 Capital One Cup defeat at Plymouth and a side that ended the game with an average age of 18. Bournemouth visit Fratton Park on Saturday for the start of the League One campaign. Portsmouth's predicament – and whether they can be considered "competitive" for the season ahead – is likely to be discussed at a scheduled Football League general meeting on Thursday.

"We are working behind the scenes with the manager to enable the club to field as strong a team as possible for its first league match," said Birch. "We have noted Portpin's offer to support any efforts to save Portsmouth in the forthcoming days. We are therefore urgently seeking a meeting with Portpin and the trust to determine if the trust's bid can be brought to a successful conclusion."

The fans' group, SOS Pompey, added: "We call on Mr Chainrai to do the decent thing and accept the trust's offer to purchase his charge on the club, and therefore walk away from Pompey regaining some of the money he has lost and leaving the club in the hands of the people who will truly cherish it and ensure that it continues as both a business and a legacy for the future. We hope that this latest news could be the light at the end of the tunnel, which ultimately returns the club to the fans."