UPDATE 1-3i and CVC eye Singapore's F&N printing unit-sources

(Adds detail, background)

By Saeed Azhar

SINGAPORE, Aug 28 (Reuters) - Private equity firms 3i Group (III.L: Quote, Profile, Research) and CVC Capital are among the bidders for Fraser & Neave's (FRNM.SI: Quote, Profile, Research) printing and publishing business, which may sell for at least $400 million, sources said.

The first round of the auction of the unit, which includes Times Bookstores in Singapore and Malaysia, is likely to be held in September, a source with direct knowledge of the deal told Reuters on condition of anonymity because he was not authorised to talk about the transaction.

Conglomerate Fraser & Neave, which brews beer, runs shopping malls and prints magazines, in June announced a strategic review of its printing and publishing businesses and said it had hired Morgan Stanley (MS.N: Quote, Profile, Research) to advise it.

One banking source said the unit may also attract some strategic buyers apart from the buyout funds, which have piled into Asia in the last few years to take advantage of booming economies.

The printing and publishing business reported a 6 percent drop in revenue to S$256 million ($181 million) in the first half of the company's financial year that ends in September.

It accounted for about 10 percent of group revenue.

The strategic review was announced in late June when Fraser & Neave said that it will not appoint a new group chief executive but will instead have CEOs for each of its three business divisions -- breweries, property, and publishing and printing.