Australia's Bega Cheese Ltd. is in talks with non-Australian investors on a possible sale of its stake in Warrnambool Cheese and Butter Factory Co. Holdings, a source told Reuters on Friday.

According to the report, Warrnambool has been the takeover target for Bega, fellow Australian cheese maker Murray Goulburn Co-operative Co. Ltd. and Canadian dairy giant Saputo Inc. Warrnambool is Australia's oldest dairy firm.

Bega kicked off the takeover war in mid-September, but decided last week not to extend its final offer after being out-bidded by its rivals. It is currently considering what to do with its 18.7% stake in Warrnambool, the Reuters source said. Bega is the biggest shareholder in the dairy firm.

The source said that people think Bega will sell its stake either to Murray Goulburn or to Saputo. Bega, however, has been approached by other companies including non-Australian firms since closing its bid. The said companies were not identified.

Bega reportedly wouldn't want to be entertaining a third party unless the price for its stake was above AU$9.50 per share, Reuters wrote.