UPDATE 1-Hynix to sell back-end equipment to China venture

* Hynix to sell $305 mln worth of assets to future China JV

* China JV to be established by year-end

* Secures funds allowing it to focus on R&D

* Says raised DRAM contract prices 10 pct in April

(Adds details, background)

SEOUL, May 18 (Reuters) - Hynix Semiconductor Inc (000660.KS) secured much-needed capital on Monday by agreeing to sell packaging and testing equipment worth $305 million to a soon-to be formed back-end joint venture in China.

The world's second-largest maker of computer memory chips, which has struggled with massive losses stemming from a two-year downturn in the memory chip market, had been looking at ways to secure cash in order to remain competitive.

Hynix will put more focus on the core business of front-end manufacturing and extend R&D investment "to the fullest," the company said in a statement.

The back-end joint venture will be formed within this year with Wuxi Industrial Development Group Co Ltd, Hynix said, adding that the asset sale would also be completed during that period.

Shares in Hynix rose 1.13 percent to 13,450 won at 0040 GMT, outperforming the wider market's 1.37 percent fall.

Leading Hynix shareholders hope to sell their stake in the second half to secure gains amid renewed interest in Hynix and cautious signs of recovery in the battered dynamic random access memory (DRAM) chip market.

Hynix sold 725 billion won ($579 million) in new shares this month, in a sale that drew about 26 trillion won ($20.77 billion). It raised 324 billion won ($256 million) from the sale of new shares in January and has also secured fresh loans and debt rollovers from former creditors.

Separately, Hynix declined to comment on a local media report that it would raise prices of its mainstay DRAM chips by 10 percent in May, but confirmed that it did raise prices by about 10 percent in April.

($1=1252.0 Won) (Reporting by Marie-France Han and Rhee So-eui; Editing by Ken Wills)