CJ Foodville Co., the food service unit of South Korean conglomerate CJ Group under restructuring due to plunging sale in franchise business amid virus outbreak, is handing over factory in Jincheon, North Chungcheong Province to CJ CheilJedang Corp. for 20.74 billion won ($17.6 million).
The property and the business right will be handed over to CJ CheilJedang on Nov. 30, according to its disclosure on Monday.
The sale is to improve its business portfolio for management efficiency, CJ Foodville said, adding that it plans to use the proceeds to expand its restaurant business.
CJ CheilJedang will expand home meal replacement (HMR) lineup with the factory addition.
The latest move is one of CJ Foodville’s rigorous restructuring efforts to improve its bottom line devastated by slow sales. It sold its 45 percent stake in coffee shop chain A Twosome Place to Hong Kong’s private equity firm Anchor Equity Partners last year. It now is seeking to sell off its bakery label Tous Les Jours, the country’s No.2 bakery chain following SPC Group’s Paris Baguette.
CJ Corp., the holding company of CJ Group, however, said it is exploring various ways to enhance the corporate competitiveness but nothing has been decided yet about the reported sale of the bakery business.
CJ shares closed 0.36 percent higher at 82,500 won in Seoul on Tuesday, and CJ CheilJedang 0.51 percent up at 394,000 won.
By Lee Ha-yeon
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