Adds shares up 10% in paragraph 3; CEO quote and analyst estimates of valuation in paragraphs 5 and 7

DUBLIN, Sept 23 (Reuters) - Irish building materials manufacturer Kingspan Group KSP.I has begun working on an initial public offering of 25% of its data-centre focused ADVNSYS business in a deal that could leave Kingspan debt-free, the company said on Tuesday.

The initial public offering of ADVNSYS, which produces bespoke critical infrastructure such as ventilation and daylighting, would take place in Amsterdam, likely in the first quarter of next year, CEO Gene Murtagh told analysts on a conference call.

Kingspan shares were up 10.5% at 0835 GMT.

Kingspan would control 75% of ADVNSYS after the flotation and would continue to consolidate its revenues and earnings, Murtagh said. Two global investment banks have already been appointed to jointly lead the process, he added.

"If that was successful, both Kingspan as the parent and ADVNSYS would end up essentially with zero debt, and obviously huge runway for both the businesses to take it from there," Murtagh said.

ADVNSYS recorded earnings before interest, taxes, depreciation and amortization (EBITDA) of 197 million euro ($230 million) last year and that could hit around 300 million euros next year, Murtagh said.

With rivals servicing the data centre industry trading at 20 times earnings, that could imply a valuation of over 6 billion euros, CITI analysts said in a note. Goodbody stockbrokers in a note said trading multiples in the sector "can be far in excess of 20x EBITDA."

($1 = 0.8482 euros)

(Reporting by Atharva Singh in Bengaluru and Conor Humphries in Dublin; Additional repoting by Danilo Masoni; Editing by Mrigank Dhaniwala and Louise Heavens)

((Atharva.Singh@thomsonreuters.com;))