UPDATE 2-Aviva to get $624 mln from Delta Lloyd stake sale

* Aviva expects to get 381 mln stg from Delta stake sale

* Placing 25 mln Delta shares at 17.25 euro per share

* Deal to cut Aviva's stake in Delta to 43 pct vs 58 pct

* Delta Lloyd shares fall 7.2 percent

(Adds analyst reaction, detail, background)

LONDON, April 12 (Reuters) - Insurer Aviva (AV.L) said it expected to get 381 million pounds ($623.5 million) from selling a quarter of its stake in Dutch unit Delta Lloyd (DLL.AS), prompting speculation it could sell the entire holding.

Aviva, Britain's second-biggest insurer, on Tuesday said it would sell 25 million Delta Lloyd shares at 17.25 euros per share to institutional investors in a private placement, cutting its stake to 43 percent from 58 percent.

Shares in Delta Lloyd were down 7.2 percent at 17.62 euros by 1015 GMT, reflecting speculation the British insurer could follow up with further sales.

Aviva shares were 1.9 percent lower.

"The sale confirms that Delta Lloyd is no longer a strategic stake to Aviva and that a further sale - and thus share overhang -is possible," KBC Securities analyst Dirk Peeters said in a research note.

Aviva acquired Delta Lloyd in 1973, but offloaded a third of its 92 percent holding in a Nov. 2009 IPO after an unsuccessful attempt to challenge corporate governance rules which severely limited its control over its Dutch subsidiary.

The British insurer, which operates in about 30 countries worldwide, said last month that the Benelux region was among 18 markets that it was "de-emphasising" as part of a plan to refocus on the territories where it is most profitable. [ID:nLDE7211VV]

Aviva's decision to reduce its stake in Delta Lloyd, a big investor in corporate bonds and mortgage loans, will also make the British insurer less vulnerable to credit risk, analysts said.

"The deconsolidation will help reduce Aviva's above average risky asset exposure. We view the remaining stake as an equity investment which will be sold down entirely over time," Jefferies analyst James Shuck wrote in a note.

Aviva had announced its intention to sell the Delta Lloyd shares on Monday, saying it would hold the proceeds in cash, improving its liquidity and giving it more financial flexibility. [ID:nLDE73010I]

($1=.6110 Pound)

(additional reporting by Gilbert Kreijger in Amsterdam and Myles Neligan in London.)

(Reporting by Sudip Kar-Gupta; editing by Kate Holton and Jane Merriman)