* Analysts say over 6.6 percent of stock could yet be sold
* Stock sold to UniCredit, "group of investors"
* Foreign holdings in co blamed for field bid failure
By Zlata Garasyuta and Melissa Akin
MOSCOW, Sept 27 (Reuters) - Russian oil company LUKOIL led Russian shares lower on Monday on investor disappointment that it failed to buy out all the LUKOIL shares held by its strategic investor, ConocoPhillips.
Russia's No. 2 oil producer said on Sunday it had exercised an option to buy 42.5 million of its own shares from U.S. oil major ConocoPhillips, which once owned 20 percent of the Russian oil company.
Conoco decided to exit, leaving LUKOIL with an option to purchase the shares. It has now exercised options for all but 6.6 percent of its shares from ConocoPhillips at a cost of $5.82 billion in two transactions.
LUKOIL shares closed down 4.05 percent on Monday on the MICEX exchange, whose main share index fell 1.22 percent.
"First of all the market is not very pleased that LUKOIL bought less than half the (outstanding 11 percent) stake. Second it is not clear who this group of investors is, and the market does not like uncertainty," Citi head of equity sales Anatoly Darakov said.
The company said it purchased the stock in the form of American Depositary Receipts (ADRs), each representing one ordinary share, and resold them to UniCredit in a back-to-back transaction at $56 per share.
It said UniCredit would make the payment to the Conoco unit that held the shares.
In a separate press release it said it was sold to a group of investors, without elaborating. It said it had found a way to exercise the option without increasing its debt burden.
A LUKOIL official declined to comment further.
"LACKED RESOLVE"
UBS had upgraded the stock on Friday in part because its analyst saw the buyback of the 11 percent still outstanding as a catalyst for the shares.
"Traders that have been buying in the hope that the whole block might have been sold to a new strategic partner have been disappointed," Uralsib strategist Chris Weafer said.
"There is still an overhang of over 6 percent of LUKOIL equity, and the 5 percent block acquired this weekend will also be sold in the future." On Monday, trade sources said, brokers were informally recommending that their clients short the shares, though some said they believed a deal for the remaining 6.6 percent would yet be reached.
Adding to pressure from the buyout, LUKOIL did not appear among the bidders approved to compete for the Arctic Trebs and Titov fields, with around 200 million tonnes of reserves, in an auction to be held on Dec. 2.
Russia restricts access to mineral reserves it deems "strategic" for companies with a high percentage of foreign capital. In addition to shares held by ConocoPhillips, LUKOIL has a large free float and is popular with foreign investors.
Analysts have said high foreign ownership restricts LUKOIL's access to new reserves.
"The company's decision lacked resolve, left a 6.6 percent overhang and failed to reduce the share of foreign shareholders to below 50 percent, limiting the company's chances to win at the forthcoming auction for the Trebs and Titov fields," Renaissance Capital said in a research note. (Writing by Melissa Akin; Editing by Will Waterman)