FRANKFURT, Dec 18 (Reuters) - The majority of Thyssenkrupp's management board is leaning towards a sale of its 15 billion euro ($16.5 billion) elevator division, two people familiar with the matter said, citing the conglomerate's weakened balance sheet.
Binding bids for Thyssenkrupp's most profitable business are due by Jan. 13 and will be followed by a supervisory board meeting two days later when the field of suitors is expected to be narrowed down to 2-3 parties, the people said.
The company has launched a dual track process for the division's disposal, which also includes plans for an initial public offering (IPO) of a minority stake. The firm wants to make a final decision on which path to take by end-March.
A partial IPO, however, would not bring in sufficient funds, the sources said, citing the ailing conglomerate's weakening balance sheet, which included 12.4 billion euros ($13.7 billion) in debt and pension liabilities as per end-September.
That compares with 10.2 billion euros a year earlier.
In a bid to increase its appeal to prospective suitors, Peter Walker, the elevator division's CEO, last week promised to raise margins in a bid to catch up with larger rivals Kone , Schindler and UTC's Otis.
"That wasn't an IPO pitch, it was a sales pitch," one of the people said.
A spokesman for Thyssenkrupp confirmed previous statements that it was pursuing the dual track strategy to ensure a "decision that is sustainable and the best for Thyssenkrupp and its stakeholders", declining to comment further.
The shift in thinking in Thyssenkrupp's management also raises chances for the sale of a majority stake of the division, the people said, given that the group also needs cash to invest in its other struggling units, including steel and car parts.
At least six parties have submitted bids for the division, including a tie-up of Kone and private equity firm CVC and a consortium of Blackstone, Carlyle and the Canada Pension Plan Investment Board, according to people familiar.
Advent, Cinven and the Abu Dhabi Investment Authority have also submitted an offer, the people said. ($1 = 0.9073 euros) (Reporting by Christoph Steitz Editing by Michelle Martin)