NEW YORK (CNN/Money) - AOL Time Warner is concentrating on selling the CD and DVD manufacturing unit of its music division, although it could sell other pieces of it as well, a source familiar with the situation told CNN/Money.

The New York Post reported Thursday that the media conglomerate, which owns CNN/Money, is looking at breaking up its troubled music division to three different components - its music recording business, its Warner/Chappell publishing unit which collects royalties for the sale, publication or performance of more than a million songs, and its CD and DVD manufacturing unit.

But the source told CNN/Money that while the sale of all three components is possible, the company's main focus is on selling the manufacturing unit, not all three at the same time.

The music unit has been identified by CEO Richard Parsons as the company's "most structurally challenged business." The plan to sell the different parts of the unit could raise the combined sales price to about $3 billion to $4 billion, the Post reported. The company has been looking to sell non-core assets as a way of cutting its debt from about $26 billion to less than $20 billion by the end of next year.

The separate sale of the profitable CD and DVD arm had been reported by the Wall Street Journal a week ago. The Journal suggested that the split off of that part of the music unit might allow AOL to retain the rest of the business. Technicolor, part of Thomson of France, and Canada-based Cinram International Inc., were reported to be potential buyers. The Post reported Thursday that Matsushita Media Manufacturing, as well as leverage buyout (LBO) firms may be interested in that unit, which it said could go for as much as $1 billion.

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The Warner/Chappell publishing unit could fetch as much as $1.5 billion, according to the Post, with potential buyers including major music companies Sony Music, EMI Group PLC and Bertelsmann AG's BMG, as well as LBO firms such as Blackstone Group, Thomas H. Lee Co., Texas Pacific Group and Kohlberg Kravis Roberts & Co.

EMI is also in preliminary talks with AOL (AOL: up $0.24 to $10.93, Research, Estimates) about the recorded music business, which could fetch about $1 billion according to the Post. EMI is the largest independent music company and No. 3 overall in the world. Its proposed merger with Warner Music was blocked by antitrust regulators in 2000. Another proposed combination with BMG also was blocked. But declining sales in the music industry are seen as changing the regulatory environment.

Meanwhile, the Post reported that the book publishing division, which AOL executives have confirmed they are looking to sell, has attracted bids from 12 potential buyers, including Random House parent Bertelsmann as well as Simon & Schuster owner Viacom.

The Post said it is believed that British media company Pearson, Boston-based educational publisher Houghton Mifflin and ZelnickMedia also are bidders. The paper said its own corporate parent, News Corp., which owns publisher HarperCollins, is not a bidder.