CJ Foodville, the restaurant business arm of South Korean conglomerate CJ Group, is marketing the sale of its bakery chain division Tous Les Jours to a small group of select potential buyers that mostly consist of large private equity firms, industry sources said.

The first round of bidding for Tous Les Jours will be held on September 11. Several investors showed interest in the bakery chain but only some of them, including private equity firms Q Capital Partners and VIG Partners, have been invited to the bidding process. Others including small private equity firms and industry players were not allowed to participate, according to sources.

“CJ Foodville apparently wants to give opportunities (to submit bids) to those with financial capacity, which signals that it hopes for a speedy deal,” an industry insider said. Deloitte Anjin is working with the company on the sale.

The company appears confident about its restructuring progress over the past year, industry watchers said. Last year it sold part of its Chinese operations to Chinese private equity firm Hosen Capital, while implementing cost-saving measures for its domestic business.

Industry watchers also said that the company is probably hoping that competition among large private equity investors sitting on piles of uninvested capital, known as dry powder, could push up the valuation of its bakery chain.

But low profitability, which is common in the bakery industry, and a backlash from franchisees could be obstacles for the sale. Tous Les Jours’ franchisees filed for a court injunction on September 3 to stop CJ Foodville from selling the bakery chain.

CJ Foodville posted revenue of 890.3 billion won ($750 million) on a consolidated basis at the end of 2019, with about 400 billion won of this amount coming from the bakery business. It reportedly wants about 300 billion won for the chain. (Reporting by Ik-hwan Choi)