In ten days time, Hong Kong retail-to-energy conglomerate Hutchison Whampoa will reportedly consider any offers that have come in for ParknShop, its supermarket chain.

Hong Kong is a mature food retail market but the possible sale of ParknShop, one of the two leading chains in the city, is said to have caught the eye of larger grocers on mainland China, private equity and retailers further afield.

Last month, Hutchison Whampoa, which also has worldwide interests in infrastructure, property and telecoms, said it was placing ParknShop under “strategic review” to “optimise value for shareholders”.

ParknShop has 345 stores in Hong Kong and on mainland China and generated sales of HK$21.7bn (US$2.79bn) in 2012. However, it is likely to prove tough to generate significant growth in Hong Kong, where ParknShop is one of two retailers accounting for around 70% of the food retail sector. The business’s foray onto the mainland has met with mixed success.

While Hutchison Whampoa has insisted there could be “no assurances” the review would “result in any transaction being announced or completed”, it seems likely the conglomerate is looking to sell ParknShop to fund investments in faster-growing areas like telecommunications, where it owns a majority stake in the 3 mobile phone network, and to focus on other retail sectors, such as health and beauty.

Chinese retailers China Resources Enterprise and Sun Art Retail Group have been named as companies weighing up whether to make a bid for ParknShop. Japanese retailer AEON has also been touted as a possible bidder, as have Woolworths Ltd and Coles, although it seems unlikely Australia’s two largest retailers would make a play to expand overseas when trading conditions at home are tough, especially into a saturated market like Hong Kong. Last week, there were reports private-equity giant KKR was weighing up a bid for ParknShop.

Unsurprisingly, there have been few public statements from any of the reported interested parties. One, China Resources Enterprise said it had “no comment” on what it called “market rumour”. However, it appears China Resources Enterprise – which already has stores in Hong Kong – and perhaps a private-equity player are the most likely bidders for a business for which Hutchison Whampoa is said to want US$3-4bn.

“China Resources already has a presence in Hong Kong with its Vanguard supermarkets, as well as some convenience store and other specialty retail formats,” Torsten Stocker, partner at consulting firm A.T. Kearney, says. “It is considered the number three supermarket player in Hong Kong, with a significant gap to ParknShop and Dairy Farm International Holdings-owned Wellcome.”

Aeon operates stores in Hong Kong under its Jusco banner but whether it would decide to expand in the city through the acquisition of ParknShop is uncertain. Like many Japanese firms, Aeon wants to build its business overseas and sales from its Hong Kong stores have grown. However, reports in China in March suggested Aeon had opted to put expansion in Hong Kong on hold in favour of building its business on the mainland.

ParknShop’s position as one of the top two food retailers in Hong Kong, with solid sales and stable cash flow, could appeal to private-equity firms and so it is no surprise a private-equity bidder like KKR could be interested in the retailer. KKR has just raised a $6bn Asia fund to deploy in the region, although a deal worth $3-4bn would make ParknShop the firm’s largest acquisition in Asia.

Nevertheless, a key strategy for any buyer of ParknShop would be to try to develop its business on the mainland, industry watchers argue.

“ParknShop is largely concentrated in Hong Kong – about 270 of its 345 stores are there – and it’s been seeing slowing sales growth. High rent costs in Hong Kong have put a lot of pressure on their margins. It would make sense for the buyer to develop its retail presence in the PRC further,” James Roy, senior analyst at China Market Research Group, says. “China Resources and Sun Art in particular have strong expertise in running supermarkets in mainland China, which could be a key growth opportunity for the brand.”

Stocker agrees a buyer should prioritise expansion in China. ParknShop, he says, has opened a number of smaller, more “premium” formats in Hong Kong to try to drive growth but he believes it will be difficult to boost sales in the city. That said, Stocker argues, ParknShop has not found it easy on the mainland so far.

“Given the market context in Hong Kong, growing ParknShop will not be easy, but growth could come from continuing to expand its premium store formats – Taste, International, Fusion and Great – in Hong Kong or making another push into China. If the buyer is China Resources in particular, this could help overcome ParknShop’s current lack of scale in the mainland, which has been considered one of the issues it is facing there,” Stocker says.

However, he adds: “Despite being an early entrant into China, it has never been as successful there as some of its foreign competitors, going through several rounds of stop-and-restarts.”

In just over a week’s time, we will discover if bids have been made for ParknShop, taking the Hong Kong retailer a step closer to a new chapter in its business.