Makhteshim-Agan Industries Ltd., the world’s biggest maker of generic crop chemicals, last week canceled negotiations to buy Ankeny-based Albaugh Inc. for about $1 billion. Iowa native Dennis Albaugh founded his namesake company in 1979.

Makhteshim CEO Erez Vigodman said in an e-mailed statement that “discrepancies” were found during the due diligence process. Makhteshim signed a memorandum of understanding on June 27 to buy the privately held supplier of crop protection chemicals with cash, notes and stock.

“We will continue to take the needed measures in order for Makhteshim to grow and expand in the coming years,” Vigodman said. “We will seek to boost profits by taking advantage of different opportunities in the industry.”

Makhteshim, which posted losses in two of the past four quarters, is looking to boost profit after insecticide prices declined as farmers reduced production amid the global recession, which reduced food demand. The company was seeking to acquire Albaugh after Sumitomo Chemical Co. Ltd. of Japan in December agreed to buy a 20 percent stake in Nufarm Ltd., Australia’s largest chemicals supplier to farms.

The company would have paid $340 million in cash, $455 million in notes and issued 59 million shares, representing a 12 percent stake, for Albaugh. Two years ago, Forbes magazine estimated Dennis Albaugh’s personal net worth at $1.5 billion.

“This deal was the glimmer of hope that would get (Makhteshim) out of their predicament,” said Gilad Alper, an analyst at Meitav Investment House Ltd. in Tel Aviv. “Their losses weren’t such a big issue until now, because of hopes hinging on the Albaugh deal.”