UPDATE 1-India's United Spirits looks to raise funds

(Recasts, adds CFO comments, detail)

MUMBAI, June 30 (Reuters) - India's United Spirits (UNSP.BO), the world's third-largest spirits maker, said it is looking at raising funds either through a private placement to institutions or to private equity firms, to reduce its debt.

The company, is looking to deleverage its balance sheet and reduce the size of its debt to a "sustainable" level of about 40 billion rupees, Ravi Nedungandi, Chief Financial Officer of UB Holdings, which owns United Spirits, told CNBC TV18 on Tuesday.

The company has a debt of more than 70 billion rupees ($2.48 billion).

Earlier in the day, Shaw Wallace SHAW.BO, which is now a part of the UB Group, sold off its entire stock of treasury shares of 10.28 million in United Spirits in various block deals, raising 9.05 billlion rupees.

Data from the exchanges showed that the buyers were T. Rowe Price International, DWS Investment and Capital International Emerging Markets Fund, Emerging Markets Growth Fund and Reliance Mutual Fund.

The company would use the proceeds to partially repay a debt of $1.2 billion following its purchase of Scottish spirits maker Whyte & Mackay in 2007, the company said.

United Spirits had various other options to raise additional money to use for deleveraging, including the sale of its remaining treasury shares, a placement to institutions, or a placement with private equity funds, the company said in its statement.

"USL (United Spirits) now has the luxury of doing a strategic transactions with the best possible partner in due course without liquidity pressure," it said.

Nedungadi told the channel the company was looking at raising about $250 million through a strategic stake sale.

"The UB Group has never hesiated to deleverage when its appropriate for strategic reasons. Our record is also quick deleveraging so when the opportunity presents we won't be far behind," he said. ($1=28.27 Rupee) (Reporting by Janaki Krishnan; editing by Simon Jessop)