* Consortium makes offer for country's largest private landholding
* Rivals A$365 mln bid by Shanghai CRED, mining magnate Rinehart
* Kidman sale is lightning rod for foreign investment concerns
* New bid will not require government approval (Adds comment from bidders, S. Kidman CEO)
By Colin Packham
SYDNEY, Oct 20 (Reuters) - Four of Australia's wealthiest outback cattle families plan to make the first entirely domestic offer to buy S.Kidman and Co, the country's largest private land holding, paying more than a rival bid of A$365 million ($280 million), two of the quartet said.
Kidman has already accepted a joint offer by Australia's richest woman Gina Rinehart and Chinese developer Shanghai CRED Real Estate, but the A$365 million deal is still waiting government approval and the company's board is required to consider any higher offers. is opening the door for the planned bid from the local BBHO consortium, which has the advantage of not requiring approval from Australia's foreign investment review board.
The fate of Kidman, with its vast cattle and pastoral holdings, has been a lightning rod for concerns about the sale of Australian agriculture and other key assets to foreign investors.
The Australian government has twice rejected foreign offers for Kidman, including a previous bid by Shanghai CRED and China's Hunan Dakang Pasture Farming Co Ltd 002505.SZ that had a minority Australian interest.
Domestic ownership of agriculture is seen as crucial for Australia to cash in on global food demand and to keep tax revenues onshore.
"If I was pressed, I would say the new bid is favourite," said Robert Hermann, managing director at consultancy Agricultural Markets Analysts and Advice.
Hermann said the Nationals political party, the junior partner in the ruling coalition, would be likely to switch its support from the Rinehart-CRED Shanghai offer to one that keeps Kidman 100-percent Australian owned.
Sterling Buntine, one of the BBHO quartet, said the offer the group expected to lodge formally over the weekend would be "absolutely competitive".
"It will be more than what the current bid is on the table and we would expect the Kidman board to treat it with due respect," Buntine told reporters, without confirming local media reports the consortium was offering A$385 million.
Buntine is joined in the consortium by three private cattle ranchers, Tom Brinkworth, Malcolm Harris and Viv Oldfield. None are household names in Australia but each own millions of hectares of grazing land around Australia.
Federal Treasurer Scott Morrison told parliament he was pleased local bidders were coming forward.
However, some analysts said the new deal had a couple of key weaknesses. The consortium plans to break up Kidman's 101,000 sq km (39,000 sq miles) holdings, which flies against Kidman's preference for the sale, and accepting it would cost the company more than A$3 million in break fees.
"Any counter offer has to be judged by the Kidman board as to whether it is a superior offer of not," Kidman Chief Executive Greg Campbell told Reuters. He declined to comment further.
($1 = 1.2997 Australian dollars)