Rapper Jay-Z, singer Miley Cyrus and the Killers band had all been booked to play at Woodstock 50 in New York state.

The chief funder said it could not ensure the "health and safety of the artists, partners and attendees".

The festival organiser "vehemently denied" it had been cancelled.

"Woodstock 50 vehemently denies the festival's cancellation and legal remedy will (be) sought," the organiser told US local newspaper the Poughkeepsie Journal.

But Japanese PR and advertising giant Dentsu Aegis Network whose investment arm Amplifi Live is the lead funder for the festival, said it had a clause in its contract with the organisers that gave it the option to cancel the festival.

Reports suggested that $30m (£23.2m) had already been spent on booking the artists. Dentsu declined to comment on the figure, but told the BBC that all contractual obligations had been met.

The firm said the decision to cancel the festival had been made after careful consideration.

"As difficult as it is, we believe this is the most prudent decision for all parties involved," the firm added.

Artists including Dead and Co, Imagine Dragons, The Lumineers, Chance the Rapper, Sturgill Simpson, Halsey and Cage the Elephant had been lined up to play at the three-day event due to take place from 16 to 18 August.

Around 100,000 people were expected to attend.

First signs of problems emerged when the festival tickets did not go on sale on 22 April as planned.

The original August 1969 Woodstock festival, billed as "three days of peace and music," is regarded as one of the pivotal moments in music history symbolising much of the idealism of the 1960s.