UPDATE 2-Wabco says $400 mln EU fine to hurt Q2, FY earnings

* To pay fine as part of deal with former parent

* Fine to hurt Q2 EPS by $6.06; 2010 EPS by $0.01

* To pay fine with cash on hand, available credit

* Terms fine "excessive," may appeal (Adds comments from analyst and Masco)

BANGALORE, June 23 (Reuters) - Auto parts maker Wabco Holdings (WBC.N) said a 326 million euros ($400 million) fine European Union antitrust regulators levied against entities representing its former parent for fixing prices will hurt its second-quarter and 2010 earnings.

European Union antitrust regulators fined 17 companies in the bathroom fittings industry a total of 622 million euros ($835 million) on Wednesday for fixing prices, with lower penalties for five crisis-hit firms. [ID:nLDE65M1D3]

The impact of the fine is expected to hurt the company's second quarter earnings by $6.06 a share, and 2010 earnings by 1 cent a share, Wabco said in a filing with U.S. regulators.

"It finally eliminates an overhang that has existed since the company has been public, clearing the way for buybacks," said J.P. Morgan Securities analyst Stephen Tusa in a note.

Wabco was spun off from American Standard Cos Inc, now known as Trane Inc, in 2007. As per Wabco's agreement, it is obliged to indemnify American Standard and related entities involved in the investigation against any fine, Wabco said.

The fine was on Ideal Standard International Holding SARL. Ideal acquired in November 2007 the European Bath and Kitchen division of American Standard, including European legal entities that were formerly units of American Standard Europe BVBA, and has continued the relevant business.

Wabco termed the fine "excessive" but said it can pay up using its existing cash balances and available credit lines.

The company had cash and cash equivalents of $346 million at the end of March 31.

Wabco said it had "strong" grounds to appeal, and was waiting for the full text of the commission's judgement.

It has never manufactured or marketed any of the products that are the subject of this investigation, and no one from the company had any involvement with the matter, Wabco said..

U.S. building products maker Masco Corp (MAS.N), whose main subsidiaries are Hansgrohe and Hueppe, received immunity as it was the first to provide information about the cartel, the European Commission said.

Masco said it had discovered and stopped certain units from participating in "anticompetitive business practices" in the bathroom faucet and shower enclosure industries in certain countries in Europe. [nWNAB0538]

Wabco shares pared early gains and were down 13 cents at $34.32 in late morning trade, while Masco shares were down more than 1 percent at $11.81 on the New York Stock Exchange. ($1=.8151 Euro) (Reporting by Bijoy Koyitty; Editing by Gopakumar Warrier)