"We were relatively close," said Earl Cochrane, Toronto's director of team and player operations.
It seemed like a good match.
The 36-year-old Davies is looking for a new home, given that he apparently has become surplus to requirements at Bolton after 10 years at the English club. Bolton has said he won't be offered a new contract when the existing one runs out at the end of the season.
Toronto manager Ryan Nelsen is friends with Davies. TFC could use some depth up front. And Davies has extensive Premier League experience.
"He's at the end of his contract, he was talking about some options and then Toronto became a real possibility so we went down the road, investigated just what it would take to get him over here," Cochrane said Wednesday.
"We had some serious conversations with Kevin and his agent, to the point we thought something was going to be able to get done. And then I think, in the end, he weighed his options, looked at his situation, what it was going to mean, probably consulted with his family a little bit and decided that it probably wasn't in the best interest."
Davies, in a statement, confirmed his interest in Toronto and MLS.
"It has been a complete roller-coaster since first speaking with Ryan Nelsen on April 18," Davies said, according to the Bolton News. "As it stands today I will not be leaving for Toronto FC, as reported.
"My young family and I were naturally very excited about the opportunity of going to Toronto on a short-term deal but after legal advice we felt that certain obstacles put in our way were too large to overcome."
That would suggest some kind of contractual wrangle, given the stated family's interest.
Toronto had looked at several ways of acquiring Davies, including a loan until the end of the season.
Davies called it "the toughest month" of his Bolton career but says he "will finish the season here and continue with my high standards as a professional footballer.
"I will be ready if the manager needs me and hopefully have a part to play in helping the club return to the Premier League."
Bolton currently stands sixth in the second-tier English Championship.
Davies, a 10-year Bolton veteran, has slipped from being on the bench to out of the match-day squad in recent weeks.
Nelsen has successfully mined his British club connections in signing the likes of Earnshaw, Hogan Ephraim, John Bostock and Darel Russell.
But Davies is the second forward to elude Toronto FC in recent days.
On Tuesday, Nelsen said the club had ended its pursuit of Argentine forward Maximiliano Urruti.
But the arrival of Argentinos Juniors midfielder Matias Laba is expected to be announced soon.
Urruti has been linked with Toronto for some six weeks but club officials appeared to have been frustrated in their dealings with his Newell's Old Boys side, which is undergoing financial issues.
Toronto has been looking for help in attack, where Robert Earnshaw has been carrying the load with help from Justin Braun in the absence of star striker Danny Koevermans, who is expected to return in June from knee surgery.
Andrew Wiedeman is also an attacking option.