UPDATE 3-Alstom would be interested in Areva T&D unit

* Says current conditions not favourable to tie-up

* Interested in T&D because of potential synergies

(Adds Areva spokesman comment)

PARIS, March 10 (Reuters) - French industrial engineering group Alstom (ALSO.PA) would be interested in the transmission & distribution unit of nuclear power group Areva CEPFi.PA if the latter wanted to sell, an Alstom spokesman said on Tuesday.

"Alstom has often declared its interest in a tie-up with Areva but under the current conditions this is not possible," the spokesman said.

"We confirm our clear interest in the electrical generation and transmission and distribution activities of Areva, if they were for sale, because of the potential synergies," he added.

A spokesman for Areva said the group had no plans to sell the T&D unit, adding that it had not received any proposal from Alstom.

At 1215 GMT Alstom shares were up 2.4 percent, outperforming a CAC-40 index up 1.3 percent.

Les Echos newspaper said on Tuesday that Alstom wanted to buy back the transmission and distribution activities it sold to Areva in 2004, as part of its financial rescue plan.

Alstom has repeatedly said it is in favour of a merger with the world's biggest maker of nuclear reactors, which is almost 80 percent owned by the French state, but Areva's chief executive has spoken out against a tie-up.

"There are strong links with (Alstom's) power systems activity," said an Alstom spokesman. "We do not hide the fact that we are interested in a 're-acquisition' because of these synergies."

The paper said the transmission and distribution activities were sold for 930 million euros ($1.18 billion) in 2004 but are now valued at over 5 billion euros after strong growth and represent around 38 percent of Areva's turnover.

Areva is in need of cash to fund its international expansion and compete with rivals Westinghouse Electric, a unit of Japan's Toshiba (6502.T), and Russia's Atomenergoprom, but has said it would not sell its transmission and distribution activities.

The group last month unveiled a 2.7 billion euro ($3.41 billion) investment plan, which it said was approved by the French state. [ID:nLP651355]

"The plan has been approved, and I am sure that we will find the best funding solutions in the coming weeks," Chief Executive Anne Lauvergeon told a news conference on Feb. 25 as the group announced a 20 percent fall in full year net profit.

Areva could fund its investments plans thanks to a capital increase or the sale of non-strategic assets such as minority stakes in groups like Total (TOTF.PA), Safran (SAF.PA) or Eramet (ERMT.PA), Chief Financial Officer Alain-Pierre Raynaud told Reuters in an interview last month. [ID:nWEA9123]

Alstom is looking at different ways to finance the purchase of the transmission and distribution activities, the paper added. The Alstom spokesman had no comment on the amounts mentioned in the paper and would not say whether any talks on a possible purchase were underway. ($1=.7909 Euro) (Reporting by Marcel Michelson, Marie Maitre and Helen Massy-Beresford; Editing by Hans Peters and Jon Loades-Carter)