Babcock & Brown Power says buyers circling

(Adds buyer interest)

SYDNEY, Oct 21 - Australian investment fund Babcock & Brown Power said on Tuesday a number of parties have shown interest in buying all or parts of the company as it scrambles to reduce debt.

Babcock & Brown Power BBP.L, managed by investment bank Babcock & Brown (BNB.AX), made the comments as it unveiled a review of its business by UBS.

"UBS has received numerous unsolicited expressions of interest for the whole and individual assets of BBP," said Len Gill, BBP's Chairman said in a statement.

"In the current environment, BBP is too highly geared and accordingly will benefit from a substantial equity injection," he said.

Babcock & Brown's business model of buying assets using high levels of debt and bundling them into funds such as BBP has come under stress after the global credit crisis, now in its second year, made access to capital challenging and costly.

Its shares have crashed on concerns over its high debt levels. It has made sweeping management changes, restructuring plans, and asset sales.

The next phase of the UBS review will involve assessment of evolving capital market conditions and the appetite of various parties to proceed with potential transactions, BBP's Gill said.

The BBP board told UBS on Tuesday to canvas the market on the full range of transaction alternatives and to call for expressions of interest from the market as soon as practical, Gill said.