Irving, Texas-based Chuck E. Cheese's private equity owner, Apollo Global Management LLC (>> Apollo Global Management LLC), has hired Deutsche Bank AG (>> Deutsche Bank AG) and Credit Suisse Group AG (>> Credit Suisse Group AG) to solicit acquisition bids for the company, the sources said this week.

Apollo has also asked Jefferies LLC and Morgan Stanley (>> Morgan Stanley) to prepare Chuck E. Cheese for an IPO, should the acquisition offers it receives come in at less than the $2 billion that it hopes the company will fetch, the people added.

A decision on whether Chuck E. Cheese will be sold or go public is still several months away, according to the sources.

The sources asked not to be named because the process is confidential. Spokespeople for Deutsche Bank, Credit Suisse, Jefferies, Morgan Stanley, Apollo and CEC Entertainment Inc [CEII.UL], the company that owns Chuck E. Cheese, declined to comment.

Sitdown casual restaurants have struggled as consumers opt to eat at home and increasingly avoid the mall, where such restaurants are often located. The threat of a rising minimum wage has put further pressure on the sector.

Still, "interactive" restaurants such as Chuck E. Cheese, which offers video games, bumper cars and play areas in addition to food, promise a distinctive dining experience.

Its closest competitor, Dave & Buster's Entertainment Inc (>> Dave & Buster's Entertainment Inc), saw comparable store sales increase nearly 6 percent in the third quarter of 2016 over the prior year, a slower rate of growth than the 8.8 percent achieved in 2015.

Chuck E. Cheese was taken private by Apollo in 2014 for $1.3 billion, including debt. It has since sought to broaden its appeal beyond children and teenagers, expanding its alcohol offerings for adults.

Chuck E. Cheese was founded in 1977 by Nolan Bushnell, the founder of video game company Atari and one of the first bosses of Apple Inc (>> Apple Inc.) founder Steve Jobs.

The company and its franchisees now operate a system of 603 Chuck E. Cheese and 144 Peter Piper Pizza stores, with locations in 47 U.S. states and 11 other countries.

(Reporting by Lauren Hirsch and Greg Roumeliotis in New York, editing by G Crosse)

By Lauren Hirsch and Greg Roumeliotis