"Ivan chose to leave the negotiating to his agent," Allardyce told the clubs official website.
"Unfortunately, because we can't get past the agent, I've decided to withdraw our offer. It is a shame because I believe we resurrected Ivan's career.
"We had to be very patient that Ivan hadn't played for 14 months before he came here. He found it very difficult at first but then came through with flying colours.
"He ended up repaying us with some very, very good performances.
"We will now move onto somebody else."