WestLB, Flowers Mull Bid for Germany's IKB - Paper

FRANKFURT (Reuters) - German state lender WestLB [WDLG.UL] is mulling a joint bid with U.S. investor Christopher Flowers to acquire troubled IKB bank (IKBG.DE), Financial Times Deutschland reported.

The newspaper quoted banking sources as saying the government of German state North Rhine-Westphalia (NRW) had consulted Flowers over a joint bid for the bank's medium-sized businesses estimated to be worth 700 million to 800 million euros. A WestLB spokesman declined to comment.

German state development bank KfW [KFW.UL] is seeking to sell its 43 percent stake in the corporate lender and financial sources with knowledge of the situation have said the bank has received a range of offers.

IKB, originally a lender to medium-sized German companies, is on its third bailout since last July. Its investments turned sour after a surge in defaults in the risky subprime mortgage market in the United States.

(Reporting by Mantik Kusjanto; Editing by Tim Dobbyn)