PARIS/MILAN, Dec 19 (Reuters) - France's Elior hopes to raise more than 1 billion euros ($1.1 billion) from the sale of its concessions catering business Areas and is working with banks including Morgan Stanley, several sources told Reuters.
Elior could soon enter exclusive talks with a potential buyer, most likely a private equity fund, for the sale of Areas, one source close to the company said.
But Areas, which handles catering in railways and motorways, has also drawn interest from industrial players like France's Lagardere, which has not yet taken a decision on bidding for it, a Lagardere spokesperson said.
A second source added that Italy's Autogrill and Cremonini had also shown interest in Areas.
Autogrill is looking at the whole of Areas while Cremonini, which also produces and distributes food products, is mainly interested in its My Chef assets in Italy, a third source said.
The source, which said Elior was looking for around 1.3 billion euros, said Elior was keen to sell the assets en bloc.
One source familiar with the company's thinking said Elior had started tapping potential buyers, but had not yet fully excluded the idea of an initial public offering.
The French group, which has a market value of 2.2 billion euros, said last month it had launched a review of Areas as part of a plan to boost its growth and balance sheet.
Elior, which competes with Sodexo and Compass , has said it would take a decision in the first half 2019. It has declined to make further comments on the process.
With sales of 1.8 billion euros in the 2017-2018 financial year, the concession catering business accounts for 27 percent of Elior sales.
Morgan Stanley is advising Elior on the sale, several sources said, while two sources said BNP Paribas could also have a role, without specifying what this was.
Cremonini declined to comment, while Autogrill said it was ready to look at options that created value for shareholders. Morgan Stanley declined to comment, while BNP Paribas was not immediately available for comment. ($1 = 0.8755 euros) (Reporting by Dominique Vidalon, Paola Arosio, Stephen Jewkes and Francesca Landini, additional reporting by Gilles Guillaume, editing by Alexander Smith)