Swiss Unilabs is potential frontrunner in Synlab sale - sources

FRANKFURT, June 18 (Reuters) - Swiss-based medical diagnostics group Unilabs, owned by private-equity investors Apax Partners and Nordic Capital, has the potential to become a frontrunner to buy German laboratory operator Synlab in a roughly 1.7 billion euro ($1.9 billion) deal, people familiar with the matter said.

Buyout group BC Partners put Synlab up for sale earlier this year in an auction organised by investment bank Rothschild, initially targeting only to private equity firms as prospective buyers.

Unilabs has entered the auction and met Synlab's management, the sources said, adding that it is the only suitor that can take advantage of considerable cost synergies from combining Synlab with its Unilabs subsidiary, particularly in Unilabs' largest market Switzerland.

($1 = 0.8851 euros) (Reporting by Arno Schuetze, Ludwig Burger and Alexander Hübner; editing by Thomas Atkins)