UPDATE 2-KKR's Dollar General sets terms for $750 mln IPO

* Dollar General to sell 34.1 million shares

* To list under symbol "DG" on NYSE

* Price range is between $21 and $23 (Adds background about other private equity-backed IPOs, market)

By Phil Wahba and Megan Davies

NEW YORK, Oct 30 (Reuters) - Kohlberg Kravis Roberts & Co's [KKR.UL] discount retailer Dollar General Corp (DG.N) set the terms of its initial public offering on Friday, in a sign that the $750 million offering could price by mid-November.

In an updated prospectus filed on Friday with U.S. Securities and Exchange Commission, Dollar General said it planned to sell 34.1 million shares for between $21 and $23 and list them on the New York Stock Exchange under the symbol "DG."

While no date for the pricing was provided in the filing, IPOs are typically launched within two or three weeks of terms being set.

Private equity-owned firms have had a patchy time floating in the past few weeks. Fortress Investment Group (FIG.N)-backed RailAmerica Inc (RA.N) has slid 22 percent since its IPO earlier in October and Welsh, Carson, Anderson & Stowe's Select Medical Holdings (SEM.N) priced below range in September.

Analysts have in some cases faulted over-agressive pricing for a number of private-equity IPO disappointments.

The Dollar General filing came on a dismal day for the stock markets. The Dow Jones industrial average .DJI suffered its worst slide since July on Friday on concerns that the economic recovery won't be robust enough to sustain the seven-month stock rally.

Dollar General, which has 8,577 stores in the United States, is selling about 66.5 percent of the shares in the offering, with the remainder being sold by its stockholders.

Dollar General said in the filing it expected net proceeds of $467.8 million, which it will use to pay down debt.

The IPO's underwriters, led by Citi, Goldman Sachs & Co and KKR, have the option to buy up to an additional $5.11 million shares.

For the half year ended July 31, Dollar General had net sales of $5.7 billion, up 13.3 percent over the year earlier period, and made a profit of $176.6 million. (Reporting by Phil Wahba and Megan Davies; Editing Bernard Orr)