UPDATE 1-Warner Music looking for potential buyers-source
* Warner seeking potential buyers -source
* Goldman Sachs advising on process - source (Adds background about Warner, EMI)
NEW YORK Jan 20 (Reuters) - Warner Music Group WMG.N, the world's No. 3 music company, is looking for potential buyers and Goldman Sachs (GS.N) is advising on the process, a source familiar with the matter said on Thursday.
Some parties have expressed interest in the music group, said the source, who asked not to be named because the process is not public.
Earlier on Thursday, the New York Times reported that the decision to hire Goldman came after a number of potential buyers, including private equity firm Kohlberg Kravis Roberts (KKR.N) approached Warner Music's management to express interest in acquiring the company.
Goldman Sachs and Warner Music declined to comment.
Warner has long been speculated to be the natural partner for British record firm EMI's recording assets.
EMI, owned by Terra Firma, is struggling under a mountain of debt after being bought in a 4 billion pound ($6.2 billion) buyout in 2007 by the British private equity firm.
The New York Times reported that a separate set of bankers in Goldman has been working on a potential acquisition of EMI by Warner.
Warner in November posted a wider quarterly loss as revenue growth in Britain and Italy was offset by weakness in the United States, Japan and the rest of Europe, sending its shares down 8 percent.
Chief Executive Edgar Bronfman said at the time that despite the challenges he remains confident that the music industry will turn the corner and soon start to benefit from years of restructuring and cost-cutting.
The company is home to recording legends such as Ray Charles, Fleetwood Mac and The Bee Gees and current stars like Green Day and Death Cab for Cutie.