UPDATE 1-Palm oil firm Wilmar hires banks for big China IPO

* Listing of China business could net $3 bln -sources

* IPO expected by early next year

* Goldman, 2 other banks to handle offering -source

(Adds details, background, byline)

By Michael Flaherty

HONG KONG, July 3 (Reuters) - Wilmar International (WLIL.SI), the world's largest listed palm oil company, has hired three banks to handle what sources say could be a $3 billion flotation of its China business.

The Hong Kong IPO would be among the biggest so far this year in Asia, where companies have rushed back to the equity market as its gains have gathered pace.

The Singapore-based company previously said it plans to list 20-30 percent of its China operation to tap investor interest in its biggest market and to raise cash for acquisitions.