UPDATE 2-Brazil Votorantim to buy stake in Portugal's Cimpor

* Brazil Votorantim says to buy 17.28 pct stake in Cimpor

* Votorantim and France's Lafarge agree to stock swap

* Portuguese government seen playing role in Cimpor deal (Updates with deal agreement)

SAO PAULO, Feb 3 (Reuters) - Brazilian cement maker Votorantim Cimentos said on Wednesday it reached a deal to buy a stake in its Portuguese counterpart Cimpor (CPR.LS).

Votorantim Cimentos, a unit of Brazilian industrial conglomerate Grupo Votorantim, said in a securities filing it has agreed to a stock swap with France's Lafarge (LAFP.PA) for a 17.28 percent stake in Cimpor.

Brazilian newspaper O Estado de S. Paulo had reported earlier on Wednesday that Lafarge was close to selling the stake to Votorantim.

At current market prices, a 17.3 percent stake in Cimpor is worth about 716 million euros ($1 billion).

Cimpor is already the target of a $5.5 billion takeover bid by Brazilian steelmaker CSN (CSNA3.SA)(SID.N), currently a minor player in Brazil's burgeoning cement market.

Cimpor's board of directors rejected the CSN bid last month, and investors are betting CSN will end up sweetening its offer.

Brazilian antitrust authorities are worried that Votorantim's move might be "defensive," Estado said, adding that such moves would block an increase in competition in the domestic cement market.

Camargo Correa recently withdrew a bid for a minority stake in Cimpor but said it remains interested in the company.

Winning the blessing of the Portuguese government, which is reluctant to give up Cimpor to a foreign rival, might help decide the winner of a bidding war for Cimpor, according to analysts, including Pedro Galdi of SLW Corretora in Sao Paulo.

Unlike CSN, Votorantim is not attempting to win control of Cimpor, Estado said.

Cimpor has a number of large shareholders, including Portuguese construction company Teixeira Duarte with a 23 percent stake, French cement maker Lafarge with 17 percent, and state-owned Caixa Geral with a 9.6 percent.

Votorantim is the largest diversified industrial conglomerate in Brazil and also the biggest cement maker in the South American country.

The Portuguese Cimpor, one of the 10 top cement producers in the world, is the fourth-largest maker of the material in Brazil and would help CSN improve its position significantly in the local market.

Cimpor's annual capacity of 6.4 million tonnes in Brazil would catapult CSN into the position of the country's second-largest cement producer behind Votorantim. [ID:nN18195825] (Reporting by Cesar Bianconi and Guillermo Parra-Bernal; Writing by Luciana Lopez; editing by Carol Bishopric)