FRANKFURT/HAMBURG, Nov 18 (Reuters) - German carmaker Volkswagen (VOWG_p.DE) is holding discussions with investors to join its battery division ahead of a possible partial initial public offering (IPO) of the subsidiary, two people familiar with the matter told Reuters. The idea is to bring in investors pre-IPO so Volkswagen can gauge how the division - named PowerCo - might be valued in a potential flotation, the sources said, adding that Volkswagen is working with advisers on a potential deal structure. Volkswagen has set aside 20 billion euros ($21 billion) for investment in its battery cell business, with the PowerCo unit managing its battery production and research from mining to recycling and projects including energy storage systems. Former Volkswagen CEO Herbert Diess floated the idea of a listing in May last year as a means of funding the carmaker's battery expansion plans. Volkswagen's US charging station network Electrify America, in which Siemens (SIEGn.DE) has invested a low three-digit million amount, could serve as a model for investor participation, the second source said.

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