Bakery franchise Tous Les Jours draws Affirma Capital, chemical group as bidders

  • 2020-09-11

Bakery franchise Tous Les Jours, a division of CJ Foodville Corp., has drawn four preliminary bidders for its sale, including Singapore-based Affirma Capital and South Korea’s chemical- to steel-focused KG Group, according to investment banking sources on Sept. 11.

CJ Foodville is carving out the bakery chain as part of the parent CJ Group’s efforts to shed non-core assets. CJ is demanding at least 300 billion won ($253 million) for the sale, while the bidders value the franchise at 200 billion won based on its EBITDA, said the sources.

The two other participants in the auction are JKL Partners and a consortium of NH Private Equity and Opus Private Equity. Deloitte Anjin is handling the sale.

KG Group is the only strategic buyer among the four preliminary bidders. It has been building its presence in the food industry since the acquisition of fast-food franchise KFC Korea from CVC Capital in 2017.

Currently, the business group is in final stages of talks to buy South Korea’s coffee house chain Hollys Coffee from IMM Private Equity, in a deal estimated to be between 150 billion and 200 billion won. Last year, it took over debt-ridden Dongbu Steel Co. Ltd. from creditor banks for an undisclosed sum.

Tous Les Jours is the second-largest bakery franchise in South Korea and has been generating operating profits on a steady basis.

“Tous Les Jours lacks brand identity and is lagging far behind the sector leader in terms of market share,” said one of the sources. “If it is spun off from the conglomerate and changes its systems such as the distribution structure, it will be able to improve profitability significantly.”

Among the bidders, Affirma Capital recently sold its 100% stake in South Korea’s largest waste treatment company EMC Holdings Co. Ltd. to SK Engineering & Construction Co. Ltd. for slightly over 1 trillion won.

Last month, JKL Partners handed in a non-binding bid for pre-IPO shares in Korean TV drama producer JTBC Studios Co. Ltd.

By Chaeyeon Kim

why29@hankyung.com

<Edited by Yeonhee Kim>