Motor racing business Formula One will start pre-marketing for its up to $3 billion Singapore initial public offering on May 22 after receiving approval from the city's stock exchange for the deal, sources with direct knowledge of the plans said on Monday.

The company is seeking to raise at least $2.5 billion, vying to rank among the top IPOs in the world this year after Facebook Inc raised as much as $18.4 billion and a planned $3 billion listing by Malaysia's Felda Global Ventures Holding.

The IPO is set to be priced before the end of June after the company and its bankers meet with investors and fund managers to gauge demand for the IPO, the sources said, who asked not to be named because they were not authorized to speak publicly on the matter.

Formula One would join British luxury jeweler Graff Diamonds in braving equity markets despite a slump in global stocks. Graff started taking orders on Monday from institutional investors for its up to $1 billion Hong Kong IPO.

IPOs had their worst start in about four years in the Asia-Pacific region with overall equity market activity down about a fifth from 2011 as investors fretted at buying new shares because of falling markets.

MSCI's index for Asia ex-Japan fell about 10.4 percent over the past month on concerns over slower growth in China and the fallout from Europe's debt crisis. A source close to the Formula One deal said on May 12 the IPO could be delayed because of the ongoing market jitters.

Formula One could have its B+ long-term debt ratings lifted one notch after the IPO because of an expected improvement in its debt profile, Standard & Poor's said in a May 15 report when it put the company on "positive" watch.

The decision "mainly reflects our view that after the IPO in the next two to three years, Formula One's adjusted leverage is likely to lessen significantly and durably and that private equity sponsors will exit Formula One's capital in the medium term," S&P said in the report.

Formula One's IPO approval by the Singapore exchange was reported earlier by Bloomberg.

Formula One, which holds 20 races around the world and has a more than 500 million television viewers, is controlled by private equity firm CVC Capital Partners, with a 63.4 percent stake.

CVC plans to reduce its stake as part of the IPO along with other shareholders in Formula One, the source added.

Formula One earlier this month unveiled a $1.8 billion refinancing package to help lay the groundwork for the IPO.

Goldman Sachs, Morgan Stanley and UBS were hired to lead the IPO. Spain's Banco Santander , Singapore's DBS Group and Malaysia's CIMB will also act as joint bookrunners on the deal.

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