Private-equity bidders KKR & Co. and TPG Capital Management have reportedly been dropped from the auction process to acquire Hong Kong supermarket chain PARKnSHOP .

ParknShop was put on the block by Hutchison Whampoa, who confirmed they were “considering strategic options” for the business at the end of July.

According to a Reuters report, citing sources familiar with the matter, KKR and TPG have been ruled out of the running for ParknShop because their offers failed to meet Hutchinson Whampoa’s expectations.

Hutchinson Whampoa and the private equity firms declined to comment on “market speculation”.

The exit of KKR and TPG leaves a number of strategic buyers linked to the sale, including Chinese retailers China Resources Enterprise and Sun Art Retail Group. Japanese retailer AEON has also been touted as a possible bidder, as has Australia’s Woolworths Ltd.

ParknShop has 345 stores in Hong Kong and on mainland China and generated sales of HK$21.7bn (US$2.79bn) in 2012.

For our in-depth analysis of the likely candidates interested in acquiring ParknShop, click here.