UPDATE 2-Solutia to buy Etimex Solar for $327.1 mln cash

* Etimex Solar makes solar panel covers

* Solutia shares up 0.9 percent (Adds bullets, byline, context, stock movement)

By Ernest Scheyder

NEW YORK, March 1 (Reuters) - U.S. specialty chemical maker Solutia Inc (SOA.N) said on Monday that it would buy privately held Etimex Solar GmbH for 240 million euros ($327.1 million) in cash to expand in the market for solar panel covers.

The acquisition of the unit of German plastics company Etimex Holdings GmbH would greatly increase Solutia's presence in a business that includes the rapidly growing area of thin- and flexible-film solar panels.

Competitors in that business include DuPont (DD.N), which is also making a major push to expand its sales to the renewable energy sector.

Solutia plans to finance the deal with existing cash and additional debt. It expects the transaction to close in the second quarter.

Etimex Solar posted 2009 net income of $31 million.

Shares of St. Louis-based Solutia rose 0.9 percent to $14.20 in morning trading. ($1=0.7337 euro) (Reporting by Ernest Scheyder in New York, and Sakthi Prasad and Krishna N. Das in Bangalore; Editing by Saumyadeb Chakrabarty and Lisa Von Ahn)