John Morris - founder of the collapsed double glazing company Therm-A-Stor - had been charged with two counts of fraudulent trading.
The trial, at Birmingham Crown Court, had been due to last until January, but concluded after 36 days when the prosecution decided to offer no further evidence.
Martin Wilson QC, for the prosecution, told the jury: 'It must have been obvious to all that many assertions made in the opening statements were not borne out by the evidence given . . . The Serious Fraud Office have taken the view that we cannot properly proceed with the case and I am therefore not going to offer any further evidence in this case.'
Mr Morris, 46, founded Therm-A-Stor in 1979 and the company went on to become the third largest double-glazing firm in Britain. The company collapsed with debts of pounds 14m in 1990,leaving 800 people jobless.
The fraud charges resulted from a joint investigation by the Serious Fraud Office and Cambridgeshire Constabulary into the circumstances surrounding the collapse and efforts which were made to keep the company trading.
Mr Morris, from Elstead, Surrey, was jointly charged with the company's former managing director Anthony Bonnar, 40. Both were originally charged with three counts of false accounting and six of obtaining property by deception but the charges were later reduced to two of fraudulent trading.
Judge Desmond Perrell QC, told the court: 'There were really quite sharp and naked differences between the evidence as it emerged and the evidence as the prosecution expected it to be. Strenuous effort has been put into this case by counsel during the late stages of this case but had this level of effort been put in a year or two ago things may never have come so far.'
He said that none of the evidence heard during the trial supported prosecution claims.
Mr Morris said afterwards: 'This has cost me pounds 2m so far to clear my name and I estimate that the trial has cost the taxpayer pounds 20m in total.
'From the very outset I have always protested my innocence and I am obviously pleased with the outcome . . .
'I want to thank all those people who put their faith in me and who have now been proved right in doing so.
'Lady Thatcher was among those people who supported me and I was very pleased to have backing like that.
'The biggest tragedy is that the company went into receivership with the loss of so many jobs . . . Margaret Thatcher said that the company was an example to British industry in 1983.'Reuse content