Parent company Intercement Brasil SA, whose businesses span from Brazil and Europe to northern Africa, wants to sell shares of Loma Negra in Argentina and New York to raise cash and cut debt, said the people, who requested anonymity to discuss the deal freely this week.

Loma Negra filed for an IPO with the U.S. Securities and Exchange Commission late on Tuesday. Underwriters for the IPO include the investment banking units of Morgan Stanley & Co (>> Morgan Stanley), Banco Bradesco SA (>> Banco Bradesco SA), Bank of America Corp. (>> Bank of America), Citigroup Inc (>> Citigroup), HSBC Holdings Plc (>> HSBC Holdings), Itaú Unibanco Holding SA (>> Itau Unibanco Holding SA), according to the SEC filing.

Camargo Correa SA, the industrial group that owns Intercement, has long considered a partial sale of Loma Negra as Argentina slowly lures back foreign investment with President Mauricio Macri's market-friendly policies.

The move also shows how Camargo Correa's controlling family is battling the effects of Brazil's longest recession on record, years of rampant borrowing and a corruption probe that ensnared the group's engineering unit.

Proceeds from the Loma Negra IPO, which could offer as much as 30 percent of the company, will be used by Intercement to reduce its debt, which totals five times its annual earnings before interest, taxes, depreciation and amortisation, one of the people said.

Representatives for Intercement did not immediately comment. Newspaper Valor Economico first reported details of the IPO on Wednesday.

Camargo Correa purchased Loma Negra in 2005 for $1 billion (767.05 million pounds), the first in a series of acquisitions to strengthen Intercement in emerging markets. Loma Negra was founded in 1926 by Argentine businessman Alfredo Fortabat.

Reuters reported in December that Camargo Correa had contacted investors over a private sale of a minority stake in Loma Negra, but talks did not bear fruit.

Over the past two years, with Brazil's recession and corruption scandals taking a toll on finances, Camargo Correa undertook a quick effort to downsize. It has since exited power utility CPFL Energia SA (>> CPFL Energia S.A.) and apparel maker Alpargatas SA (>> Alpargatas SA) in 2015, fetching some $3 billion from the sales.

(Reporting by Tatiana Bautzer; Editing by Richard Chang)

By Tatiana Bautzer and Guillermo Parra-Bernal