Melbourne, June 30 - Bidders in the up to $960 million race for Australian food producer Dairy Farmers narrowed to two groups on Monday after Australia's regulator said New Zealand dairy cooperative Fonterra had withdrawn a solo bid.
But Fonterra, the world's largest dairy exporter, may still be in the frame after Dairy Farmers, which is owned by some 2,000 Australian farmers, said separately that Fonterra was exploring a joint bid with one of the other parties, Australia's National Foods.
Dairy Farmers makes Dairy Farmers brand milk, Coon cheese and Ski yoghurt and put itself up for sale in April. Bidders had initially been Fonterra, Italian food firm Parmalat and National Foods, owned by Japan's Kirin Holdings, in partnership with Warrnambool Cheese and Butter Ltd.
Australian dairy firm Warrnambool said on Monday it was unaware of any joint bidding arrangement with Fonterra.
"The report of a new syndicate involving Warrnambool Cheese & Butter is not correct and Warrnambool has no knowledge of any such association," the company said in a statement.
National Foods declined to comment, citing confidentiality agreements with Dairy Farmers. Fonterra and Kirin also declined to comment.
Analysts said Fonterra's withdrawal of its bid for consideration by the Australian Consumer and Competition Commission (ACCC) could indicate it was dropping out completely, even as Dairy Farmers sought to maintain interest by announcing the joint bid with National Foods.
"It does seem they (Fonterra) are making an official move to say they are no longer interested, because they would need the endorsement of the ACCC to bid for those assets," said a food and beverage analyst who declined to be named because he does not follow Dairy Farmers closely.
Last week, Fonterra bought Nestle Australia's yoghurt and dairy desserts business, a deal analysts said gave the cooperative most of the additional brands in Australia that it wanted.
The ACCC on Monday also delayed a decision on the National Foods and Warrnambool bid, which had been due on July 3, saying it was awaiting further information from the companies.