UPDATE 1-Greece's Mytilineos to bid for Larco- CEO

(Adds background, CEO quotes)

ATHENS, June 24 (Reuters) - Greek metals group Mytilineos Holdings (MYTr.AT), southeast Europe's biggest producer of aluminium, plans to bid for troubled state-controlled nickel producer Larco, its chief executive said on Wednesday.

"It's a challenge we're ready to assume and create one of Europe's biggest metals groups west of the Urals," CEO Evangelos Mytilineos said during a presentation to analysts in Athens.

Mytilineos said he plans to cut Larco's operating costs by 30 percent and to invest up to 150 million euros in the company, which is one of the world's top producers of steel alloy ferronickel.

Larco, jointly owned by the Greek government, National Bank (NBGr.AT) and Public Power Corp (DEHr.AT), is loss making due to falling demand, high energy costs and hedging deals that went sour. The company said in April it would cut production by 55 percent this year.

Larco, in which Greece said last month it was seeking a strategic investor, lost about 270 million euros ($374.2 million) on hedging deals over the past three years, Mytilineos said. [ID:nLJ20696]

Mytilineos said he expected the government to seek a buyer for Larco by mid-September and other, non-Greek groups to also express an interest in the company. (Reporting by Harry Papachristou; Editing by David Holmes) ($1=.7216 Euro)