UPDATE 2-HeidelbergCement sells $310mln Indocement stake-sources

* Cuts stake to 51 pct from 65.1 pct as it reduces debt

* HeidelbergCement has no plans to cut stake further-source

* Shares up 4.4 pct as share overhang removed (Adds analyst quotes, share price)

By Saeed Azhar and Tyagita Silka

SINGAPORE/JAKARTA, June 10 (Reuters) - HeidelbergCement (HEIG.DE) raised about $310 million after cutting its stake in Indonesia's PT Indocement Tunggal Prakarsa (INTP.JK) to around 51 percent to reduce debt, two sources with knowledge of the deal told Reuters.

The German cement maker is loaded with borrowings resulting from the takeover of British rival Hanson in 2007 and is selling assets around the world including in Malaysia and Australia.

HeidelbergCement sold 520.5 million shares at 6,000 rupiah a share to institutional investors, the sources said, a discount of 12 percent from Tuesday's closing price of 6,850 rupiah a share.

The sources declined to be identified because they were not allowed to discuss the deal before it was made public.

Shares of Indocement opened 2.2 percent lower in Jakarta following news of the stake sale, which cut HeidelbergCement's stake from around 65 percent, but were up 4.4 percent by 0544 GMT.

The sale removed the overhang on Indocement's shares, analysts said, adding they were bullish on the company's earnings potential and valuation compared with rivals such as Semen Gresik (SMGR.JK) and Holcim Indonesia (SMCB.JK).

"We like Indocement since it is a major player in Java, which we see as a major beneficiary from the government infrastructure projects. It also has a clean balance sheet," said Citigroup analyst Ella Nusantoro, who has a buy rating on the stock.

DEAL UPSIZED

The deal was upsized from 400 million shares after strong demand from mainly long-only funds and shares were distributed to 45 investors, one of the sources said.

Hedge funds were less keen because of tight liquidity in Indocement shares, one source said, saying the deal was equal to about one year's trading volume in the firm.

RBS (RBS.L) managed the deal, which was completed overnight. HeidelbergCement was not available to comment.

Last week, sources said lenders to Heidelberg were given an extra week to approve the company's loan restructuring plans. [ID:nL1308021]

HeidelbergCement is in the second phase of a loan restructuring that will move the maturity of around 9 billion euros of bank debt to December 2011 after banks agreed to move the maturity of a 600 million euro loan in mid-May.

Christian Kartawijaya, Indocement's chief financial officer, in Jakarta told Reuters that he was unaware of the share sale, but added it will not affect the company.

HeidelbergCement indicated it has no plans to reduce the stake to below 51 percent, one of the sources told Reuters, adding there was a 90-day lockup period for Heidelberg's remaining shares in Indocement. (Editing by Lincoln Feast)