(This refiled version of the story corrects to read insulation in paragraph one)
By Arno Schuetze and Anjuli Davies
FRANKFURT/LONDON (Reuters) - Europe's second-biggest oil company Total (PA:TOTF) is preparing for the sale or listing of its rubber and insulation unit Hutchinson that could be worth up to 4 billion euros (3.02 billion pounds), sources told Reuters.
Total has asked potential advisers to pitch for the business with a mandate to be awarded soon, four sources familiar with the matter said, speaking on condition of anonymity as the matter is private.
Total is under pressure from shareholders to improve its cash flow and protect dividends as it counts the cost of the collapse in oil prices.
A Total spokeswoman declined to comment.
Hutchinson, which began its days as a rubber manufacturer for shoes in 1853, now makes sealing systems and insulation for cars, trains and planes.
It had turnover of 3.28 billion euros as of the year ended December 31, 2013 according to its website , with over 32,000 employees worldwide.
There are scant financial details about the business but bankers estimate it has EBITDA (earnings before interest, tax, depreciation and amortisation) of around 450 million euros and could fetch a multiple of between 8 and 9 times that figure or 3.6-4 billion euros.
Total could either launch an initial public offering (IPO) of the unit or could attract strategic or private equity bidders, said the sources.
Oil and gas companies around the world have put more than $110 billion worth of assets on the block as oil prices have halved to less than $50 a barrel since last June.
Total, which bought a majority stake in Hutchinson in 1974, has pledged to achieve free cash flow before dividends of $7 billion in 2015 and $15 billion in 2017, versus $2.6 billion in 2013.
The firm has taken a more active approach to managing its business in recent years, buying and selling assets more frequently. It plans to sell $10 billion of assets in 2015-2017, having hit a target of $15-20 billion of sales in 2012-2014.
In September, it agreed to sell its adhesives business Bostik, to French chemicals group Arkema for 1.74 billion euros.
The French oil company also launched a process in September to sell its 17 percent stake in the Gulf of Mexico's Tahiti oil field, which could fetch between $1.5 $1.5 billion and $2 billion, sources familiar with the matter told Reuters.