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UPDATE 1-Osram to clear way for AMS takeover offer tonight -sources

(Adds detail, background)

MUNICH, Aug 21 (Reuters) - Osram is likely to waive an agreement on Wednesday that currently prevents AMS from making a takeover bid, paving the way for the Austrian group to enter the ring against a bid from private equity investors, two sources told Reuters.

AMS plans to buy Osram in a deal that would value the bigger German lighting group at 4.3 billion euros ($4.8 billion), trumping a competing bid by Bain Capital and Carlyle Group . To be able to do so, Osram must waive a standstill agreement.

Osram's supervisory board is expected to discuss the issue at a meeting later on Wednesday.

"A waiver of the standstill agreement is to be expected," one of the sources familiar with the matter told Reuters.

The decision would come virtually at the last minute for AMS, which has to give German watchdog Bafin 10 days to examine and approve its offer before it can launch it, but wants to do so before Bain & Carlyle's offer period ends on Sept. 5.

If the Austrian group does not manage to submit its own bid before the other one expires, the finance investors could increase their bid to win over shareholders, and AMS has no chance to react.

($1 = 0.9007 euros)

(Reporting by Joern Poltz Writing by Kirsti Knolle; Editing by Thomas Seythal and Emelia Sithole-Matarise)