* American Tower, Axiata, private equity could eye stake
* Viom says exploring IPO on NYSE or LSE
* Sources say firm could raise $350 mln
* Indian telecom tower firms recovering after 2012 setback (Adds details on stake sale, banks' names, company valuation, industry context)
April 28 (Reuters) - Viom Networks Ltd, an Indian phone tower operator majority owned by the Tata Group, is looking to raise funds either through a stake sale or an overseas listing that could raise up to $350 million, sources with direct knowledge of the matter said.
Malaysia's Axiata Group Bhd, U.S.-headquartered tower operator American Tower Corp, which operates in India, and a couple of private equity firms are among the possible bidders for the Viom stake, four sources said.
Tata Teleservices Ltd, India's No.7 mobile phone carrier by users, owns about 54 percent of Viom, which operates more than 40,000 mobile phone masts. Indian infrastructure financier SREI Group holds about 18 percent.
Four private equity investors including Singapore sovereign wealth fund GIC and Oman Investment Fund own the rest of the company.
The sources said talks are at a preliminary stage and Viom is yet to decide which route to take for fund raising. A deal, either to sell a stake or list shares in an overseas market, was at least five to six months away, said two of the sources.
A mismatch in valuation expectations of the seller and the potential bidders may derail the stake sale process, they said.
Viom is exploring an overseas initial public offering either on the New York Stock Exchange or the London Stock Exchange, a company spokesman said. He did not say how much Viom was looking to raise and if it was mulling bringing in an equity partner.
"While, we don't comment on speculation, we can confirm that Viom Networks and its shareholders have engaged international financial advisers to explore options for raising growth capital," the Viom spokesman said in a statement.
The sources declined to be named as they were not authorised to speak to the media ahead of a public announcement. An Axiata spokeswoman declined to comment, while American Tower and Tata Teleservices did not respond to requests for comment.
Tower companies in India get their revenue from leasing out mobile phone masts to carriers. A 2012 court order to revoke several carriers' permits following a licensing scandal hurt tower companies including Viom.
But growth is returning as established carriers expand their 3G and 4G networks. Viom recently landed a deal to lease towers to conglomerate Reliance Industries Ltd's yet-to-be launched 4G venture. The Indian unit of Norway's Telenor ASA is one of Viom's biggest customers.
As part of the stake sale terms, both Tata Teleservices, a unit of India's steel-to-software conglomerate Tata Group, and SREI Group are likely to divest some of their shares in Viom, the sources said.
"If the process goes through, the successful bidder will be the single largest shareholder in the company," a source said. No decision has been taken on how much the two main founders of the company will own after the stake divestment, he said.
The Viom spokesman said its advisers had valued the company between 220 billion rupees ($3.63 billion) and 270 billion rupees ($4.45 billion), including debt, and that it would decide on the route to raise capital by end-September.
Viom, which had hired a clutch of investment banks in 2010 for an Indian market listing but later put off plans due to subdued investor appetite, has less than 65 billion rupees of debt, the spokesman said.
If Viom is able to list shares in an overseas bourse soon, it could become the first Indian company to take that route after the government last year allowed firms to list and raise capital overseas without first being listed on local exchanges.
Citigroup Inc and Credit Suisse Group AG are advising Viom for the stake sale process, the sources said. A spokesman for Citigroup in Mumbai and a spokeswoman for Credit Suisse in Hong Kong declined to comment.
The company has engaged London-based STJ Advisors, a capital market advisory firm, for exploring the possibility of an IPO, Viom said in the statement. It is likely to hire a few Wall Street banks for this process as well, the sources said.
($1 = 60.6550 Indian Rupees) (Additional reporting by Yantoultra Ngui in Kuala Lumpur; Editing by Mark Potter)