By Maria Pia Quaglia and Paola Arosio
MILAN (Reuters) - Italian utility Enel (MI:ENEI) will price the sale of a stake in its Spanish subsidiary Endesa (MC:ELE) at 13.5 euros per share, three sources close to the share sale said on Thursday, which would raise about 3.1 billion euros (2.48 billion pounds) to reduce debt.
Enel, Europe's most indebted utility, is selling a stake of up to 22 percent of Endesa as part of wider plans to raise more than 4 billion euros from disposals to help it maintain its investment-grade credit ratings.
Sources had told Reuters on Wednesday Enel would be offering the shares in a price range of 13.5-13.8 euros per share. Endesa shares closed down 1.6 percent on Thursday at 13.7 euros.
Earlier on Thursday Enel increased the number of shares it was offering retail investors in the sale by 11.3 million after demand totalled 1.7 times the initial amount offered.
Enel, which owns around 92 percent of Endesa, is selling up to 22 percent of its Spanish business, including a greenshoe option, to retail and institutional investors.
The institutional offer closed midday and Enel is holding a board meeting late on Thursday to set the final price, two sources close to the share sale said.
Enel was not immediately available for a comment.
A Milan-based analyst, who asked not to be named, said the sale of Endesa shares was good news for debt reduction but added value had been destroyed.
"Our fair value on Endesa was more than 17 euros per share while the price looks like coming in at less than 14," the analyst said.
To cut its debt, Enel is also looking to sell its 66 percent stake in Slovak generating company Slovenske Elektrarne and assets in Romania though some analysts say the deals might not be finalised before year end.
Earlier on Thursday Hungary's MOL (BU:MOLB) and state-owned energy group MVM said they had made a non-binding bid for Slovenske.
Czech electricity producer CEZ (PR:CEZP) has also expressed interest.
Enel is expecting binding bids for the asset by year end.
(Additional reporting by Stephen Jewkes and Freya Berry. Editing by Mark Potter and Elaine Hardcastle)