ThyssenKrupp sells $2.45 bln shares to help pay debt

* ThyssenKrupp sells treasury shares to boost equity
* Decision made after Blohm + Voss deal scrapped
* Shares close down 0.46 pct at 34.75 eur

FRANKFURT, July 6 (Reuters) - Germany's biggest steelmaker ThyssenKrupp (TKAG.DE: Quote) has decided to sell some 1.7 billion euros ($2.45 billion) of treasury shares to institutional investors to partly pay off debts.

The decision, made on Wednesday, came after a deal for ThyssenKrupp to sell Blohm + Voss to Abu Dhabi MAR fell apart last week, leaving its plans to withdraw from civilian shipbuilding in disarray.

ThyssenKrupp -- which also makes submarines, mega-yachts, elevators and industrial plants -- said in a statement that all the remaining 49.48 million shares it has collected from the 2006 buyback programme will be sold via an accelerated bookbuilding process.

Based on Wednesday's closing price of 34.75 euros, the placement would generate gross proceeds of 1.7 billion euros.

ThyssenKrupp in May unveiled plans for a major revamp that would hive off its stainless steel unit, Europe's largest producer, as part of a 10 billion euro divestment plan that will help pay debts and build up its engineering business.

Analysts had expected the shake-up since the company's new Chief Executive Heinrich Hiesinger took over early this year.

ThyssenKrupp had amassed huge debts while in the middle of building mammoth plants in Brazil and the United States as part of its ambitious plan to expand in North America.

ThyssenKrupp's financial debt as of March 31, 2011 was 7.715 billion euros compared with 6.157 billion as of the end of its business year on Sept. 30, 2010.

"An important element of the group's strategic development is the reduction of net financial debt," ThyssenKrupp said on Wednesday.

The placement of treasury stock, which represent some 9.6 percent of capital, will also strengthen the group's equity, it added.

The sale will be managed by Commerzbank, Deutsche Bank and HSBC Trinkaus and Burkhardt.

Separately, German daily Handelsblatt said, citing sources, that Uwe Sehlbach, a board member of ThyssenKrupp's Material Services division, had to resign as a consequence of a cartel investigation into price-fixing by an operating unit and nine other steel and rail companies.

The report said Sehlbach was not involved in the alleged cartel run by the 10 companies, including ThyssenKrupp unit GfT Gleistechnik GmbH.

A spokesman for ThyssenKrupp told Reuters Sehlbach left company on June 30, declining to give any further comment.($1=.6930 Euro) (sourced Thomson Reuters)