Melbourne, Oct 17 - Private equity firms have dropped out of the bidding for Groupe Danone's Australian and New Zealand business, which could be worth up to A$1 billion ($685 million), leaving trade buyers to battle it out, sources said on Friday.
The last private equity bidder, Pacific Equity Partners, has withdrawn from the bidding process for the unit, Frucor Beverages, a person familiar with the situation told Reuters.
The global credit crunch has seen private equity's access to funding dry up, but the tough market conditions have not deterred potential trade buyers, which include Coca-Cola Amatil Ltd, the Australian unit of Japanese brewer Kirin and Asian soft drink bottlers Fraser & Neave , according to bankers and analysts.
The deadline for second-round offers is imminent, a second source said familiar with the process said.
About five parties submitted indicative bids last month, banking sources told Reuters at the time. That was less than a month after the French food group announced a review of Frucor, whose products include Mizone flavoured mineral water, Just Juice and the Pepsi franchise in New Zealand.
Coca-Cola Amatil Chief Executive Terry Davis told the Australian Financial Review in an interview published on Friday that CCA had put in an indicative bid for Frucor, but had been told others had put in higher offers.
A spokesman for Kirin's National Foods unit declined to comment on whether it was interested in Frucor.
Frucor is seen as still attracting a solid price despite the market turmoil because it is a defensive asset. Other food and beverage stocks have held up during the market downturn as investors look for firms that are insulated from a slump in consumer spending.
UBS analysts value Frucor at about A$1.08 billion ($740 million) including debt, based on an estimated net profit for fiscal 2008 of A$404 million.
Private equity firms including CCMP Capital Asia and a consortium including Kohlberg Kravis Roberts, Merrill Lynch Private Equity and the privately owned P&N Beverages withdrew from the bidding earlier this month. ($1=A$1.45)