Russia IES to sell Lenenergo stake in Europe -source

MOSCOW, Feb 18 (Reuters) - Russia's Integrated Energy System (IES), owned by billionaire Viktor Vekselberg, wants to sell a blocking stake in power producer Lenenergo (LSNG.MM: Quote, Profile, Research) to a range of investors on European markets, market sources said on Monday.

"IES may place the blocking stake in full or in part as depositary receipts in Europe. The decision on the platform has not been made, and a road show is scheduled for February," a source close to the company told Reuters.

"This is a non-deal road show, which means it is being carried out in order to gauge investor reactions, boost ratings and improve conditions for taking out loans," the source said.

IES, which is also known by the Russian acronym KES, declined to comment, as did Lenenergo, a utility serving the northwestern Leningrad region.

Lenenergo is controlled by Russia's former electricity monopoly Unified Energy System (UES) EESR.MM, which is in the process of selling off all of its assets with the aim of raising investment and introducing a competitive market for power.

IES currently holds a 4.4 percent stake in Lenenergo through a subsidiary, but under an earlier agreement, it is required to buy another 25 percent within the next three years from state-controlled VTB (VTBR.MM: Quote, Profile, Research), Russia's second-largest bank. (Reporting by Olga Popova and Denis Pinchuk, writing by Simon Shuster, editing by Will Waterman)