UPDATE 2-EDF buys majority of Areva reactor unit, seeks partners

* EDF to buy min 51 pct, max 75 pct of Areva reactor arm

* EDF says expects to find partners to invest in Areva NP

* EDF says protected from Finland damages claims

* Areva shares open 3 pct higher, EDF 2 pct higher (Adds EDF CEO comments, share move)

By Geert De Clercq

PARIS, July 30 (Reuters) - French state-controlled utility EDF is buying a majority stake in the reactor business of nuclear group Areva and will look for partners to take a minority stake.

The deal is crucial for France, which generates three quarters of its electricity from nuclear plants and needs to keep Areva alive in order to service its existing reactor fleet, as well as supporting its large nuclear industry with export contracts.

EDF said on Thursday it would buy between 51 percent and 75 percent of Areva’s reactor arm Areva NP, while Areva would keep a maximum 25 percent. Areva said separately it would sell at least 75 percent of Areva NP to EDF for about 2 billion euros ($2.2 billion).

EDF chief Jean-Bernard Levy told reporters that if EDF finds no other partners to invest in Areva NP it could end up with 75 percent, but potential partners had already signaled their interest.

“We expect that we will end up with a tripartite situation in which EDF owns 51 percent, Areva 25 percent and one or more partners the rest,” Levy said on a conference call.

EDF said in a statement that Areva NP was valued at 2.7 billion euros for the entire unit, adding the two firms would also set up an 80-20 percent EDF-Areva joint venture for the design of new nuclear reactors.

“This is a structural change in the French nuclear reactor industry. From now on there will be only one strategic leadership, one single product policy, and only one export policy,” Levy said.

Following due diligence, EDF will submit a binding offer for the reactor unit in the last quarter of 2015 with a view to closing the transaction in the second half of 2016.

EDF said the acquisition of a 51 to 75 percent stake in the reactor business would have a neutral impact on its 2018 cash flow and it would be completely protected from any risks related to Areva’s long-delayed Olkiluoto 3 reactor in Finland, where Areva’s customer TVO is claiming billions of euros in damages.

In a separate statement, Areva said it had financing needs totaling 7 billion euros for the 2015-17 period. It added that it expected asset sales would generate about 2.4 billion euros and that it would contribute own funds of 1.2 billion.

But it added that it would need a “significant” capital increase. Both EDF and Areva are more than 85 percent owned by the French state. ($1 = 0.9112 euros) (Editing by James Regan and David Holmes)