DEALTALK-Asciano attracts interest, but deal may be tough

* Private equity funds prowling

* Cornerstone investors could rescue

* Slim gains seen for shareholders (For more Reuters DEALTALKs, click on DEALTALK/)

By Denny Thomas

SYDNEY, March 23 (Reuters) - Debt-heavy Australian ports operator Asciano Group Ltd (AIO.AX), which put itself up for sale last week, is attracting interest from private equity funds, but faces a tough job convincing its lenders after missing a previous target to sell assets.

More than half a dozen parties, including buyout funds and trade buyers, have signed up with Asciano for due diligence, with a first round of indicative bids due on April 13, a source briefed on the sale process told Reuters on Monday.

The source declined to be identified due to the confidentiality of the process.

Asciano, which has A$4.6 billion ($3.2 billion) in bank debt and a market capitalisation that has slumped to just A$517 million, expanded the list of assets it plans to sell after a seven-month sale process generated only a lukewarm response.

To start with, Asciano decided to sell part of its Pacific National coal transport business, then other businesses, aiming to fetch more than A$1 billion to help cut its debt. Now Asciano is open to a full takeover of the company.

To achieve its desired result, Asciano has brought in Lazard Carnegie Wylie to assist ABN AMRO, which was previously the sole adviser to Asciano on the asset sale process.

Despite interest from a range of potential buyers, bankers and investors are sceptical Asciano will be able to fetch the right price.

"The company's ability to do a deal for its equity holders is slim," said Tom Elliott, managing director of MM&E Capital.

Bankers say a consortium of TPG Capital [TPG.UL] and Global Infrastructure Partners, owned by Credit Suisse (CSGN.VX) and General Electric (GE.N), are still interested in buying Asciano after it rejected a A$2.9 billion bid last year, at A$4.40 a share.

Asciano declined comment and did not name any of the interested parties.

Analysts said the company may be lucky to get even A$1.50 a share now, valuing it at around A$1 billion.

Like many other debt-laden companies, Asciano's share price has collapsed on concerns about its ability to refinance maturing loans, making it hard to raise fresh equity. The stock closed on Monday at A$0.76, down from A$5.39 last August.