* Share issue to strengthen balance sheet, support rating
* To sell 16.4 million new shares at 10.5-13.5 euros
* EnBW to sell up to 40.9 million EVN shares
* EVN shares down 1.2 percent
(Adds quotes, detail)
VIENNA, Oct 5 (Reuters) - Austrian utility EVN unveiled a rights issue to raise 196 million euros ($269 million) at the indicated mid-price, with a major investor set to sell a large part of its 36 percent stake at the same time.
EVN, controlled by the province of Lower Austria, said on Tuesday it will offer 16.4 million new shares on a 1-for-10 basis at 10.5-13.5 euros to boost its balance sheet and support its credit rating.
Its shares were down 1.2 percent at 11.46 euros at 0840 GMT.
Up to 40.9 million EVN shares owned by German utility EnBW, which holds a 36 percent stake, will also be offered. EnBW, which has long flagged it wanted to sell its EVN stake, will own 10 percent of the enlarged company.
Based on the indicated mid-price, the total transaction volume may reach 687 million euros, EVN said, adding trade in the new shares was expected to start on Oct. 22.
EVN said the proceeds will also help finance renewable energy projects in Lower Austria, such as hydro power plants and wind parks, and elsewhere in Austria and neighbouring countries. (Reporting by Eva Komarek; Editing by Dan Lalor) ($1 = 0.7296 euro)