It is back to one bidder for troubled Australian surfwear retailer Billabong International, as the other interested buyer gets the cold feet leaving the company's shares performance in the doldrums.

In a statement to the Australian Securities Exchange on Thursday, Billabong declared its second suitor has withdrawn from the takeover race over the debt-laden surfwear chain. As expected, investor confidence plummeted rendering Billabong shares to fall as much as 8.3 per cent to A$1.33 as of 11:19 a.m., Sydney time.

Billabong did not provide details of the withdrawal of second suitor, which media reports said it was private equity firm Bain Capital LLC.

On Sept. 6, Billabong announced it received a second takeover bid from an unnamed party, at A$694 million ($707 million), which was just parallel to rival bidder and first suitor TPG International LLC. Billabong had consistently reiterated both offers were inadequate.

TPG, which started its due diligence in late August, remains in discussions with Billabong.

"The board of Billabong reiterates there is no guarantee that, following this formal process, a transaction will be agreed or that the board will recommend any proposal," the group said.

"It is not a good sign," analyst Tony Wilson told Bloomberg News of the competing bidder's withdrawal. "You always want a bit of bidding tension. The board may have to settle for A$1.45 if that's what TPG wants to pay," he said.

Analysts and industry observers had earlier said a takeover ruckus over Billabong will be good for the company as it will trigger a bid battle.

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Shares of Billabong Up On Second Takeover Suitor, Receives A$694 M ($707 M) Offer