UPDATE 1-HVB controls 6.4 pct stake in HeidelbergCement

* Merckle's VEM stake declines as part of repo loan

* Swap will be reversed when full loan is redeemed

* Shares down 2.7 percent by 1438 GMT (adds VEM spokesman, background, share price)

FRANKFURT, July 2 (Reuters) - Unicredit's (CRDI.MI) German unit HVB holds a 6.4 percent stake in HeidelbergCement AG (HEIG.DE) as part as a loan-for-shares swap with Ludwig Merckle, who saw his stake in the cement maker decline.

HeidelbergCement is part of the heavily indebted empire built up by industrialist Adolf Merckle, who threw himself in front of a train in January after being forced to cede control of his conglomerate to lenders. [ID:nL648545]

His eldest son Ludwig Merckle inherited the main holdings, which -- apart from a majority stake in HeidelbergCement -- include generic-drug maker Ratiopharm and drugs distributor Phoenix Pharmahandel.

Regulatory filings by the debt-laden cement maker -- the world's fourth largest -- showed on Thursday Merckle's voting stake has declined to 72.4 percent from 79.52 in early May.

A spokesman for Merckle's investment vehicle VEM said the swap was part of a so-called repo loan whereby Merckle ceded parts of his stake to the bank, which, in turn, cancelled some of Merckle's debt.

Once Merckle pays back the initial debt amount, the HeidelbergCement shares will also be returned to him, the spokesman said.

In early June, VEM's creditor banks had extended a debt moratorium to the holding company until the end of 2010, giving it time sell Ratiopharm and, depending on how much it can fetch, possibly Phoenix as well. [ID:nLA765232].

(Reporting by Edward Taylor and Hendrik Sackmann; Writing by Ludwig Burger; editing by Elaine Hardcastle)