One of the four multinational companies vying to run the Mt Eden-Auckland Central Remand Prison has pulled out of competition for the contract.
A deadline expired on Monday for each of the firms to lodge a proposal with the Corrections Department outlining how they would run the jail.
It has emerged that Kalyx withdrew from contention last month following a strategic review by its French parent company Sodexo, saying it had decided not to pursue business opportunities in New Zealand or in Australia.
Three others are still in contention; GEO, Serco and G4S, which has been subject to some critical reports earlier this year about the way it has managed prisons in Britain.
Kalyx itself has not been without some bad press. Last month, its parent company Sodexo was ordered to repay $27 million which it overcharged for catering services at schools and universities in the United States.
In a statement, the Corrections Department says the three remaining applications will go through rigorous evaluation by its staff and commercial advisers.
Reference checks and prison visits will also be made to sites run by these firms, before the successful bidder is announced early next year.