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Croatia's leading coffee roasting company Franck confirming it has submitted a non-bonding bid for the 51.55% stake available in the company.

Following the 31 October deadline for indicative bids for the stake, sold by a consortium of shareholders led by the Slovenia Sovereign Holding (SSH), unofficial information suggests that the Croatian food company Podravka is also interested in buying.

Franck confirmed having submitted a bid for Žito, but it would not reveal any details, while bakery Mlinar said it did not take part in the bidding, according to a report in Wednesday's edition of the Croatian daily Jutarnji list.

Earlier this week, the Croatian media reported that Franck was not interested in acquiring Žito on its own as the companies are not very compatible, while the acquisition would also represent a substantial financial burden for the coffee company.

"They would want to make part of a consortium along with investors that are more compatible with the operations of the Slovenian company and would take over the bulk of Žito's operations," business weekly Lider commented on its web site.

Mlinar, which is expanding its operations in Slovenia and has been mentioned by the local media as a member of the consortium that would take over Žito, said it did not submit a bid for the Slovenian company.

Apart from Mlinar and Franck, the Slovenian daily Dnevnik also mentioned milling company Čakovački mlinovi and confectionery company Kandit as members of the alleged Croatian consortium.

Citing sources close to the management of Podravka, Jutarnji list reported that the company was interested in acquiring Žito and would probably join the bidding process independently once "the competition becomes serious".

The second round of binding offers is to follow upon the completion of due diligence. The stake, sold by SSH (12.26%) the state-owned Modra zavarovalnica (14.97%) and several private asset management firms and mutual funds, is valued at EUR 46.2m.

Žito is a major player in Slovenia and in SE Europe in the bakery, confectionery, milled products, frozen foods, sweets, pastry, pasta, spices, tea and rice segments. It is one of the 15 state-owned companies slated for privatisation. Several attempts to sell the company in the past failed.