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* Sale priced at 75-76 pence per share - sources
* Sale will raise over 3.2 billion pounds - sources
* UK will not sell any more shares for 90 days
* Sale reduces size of govt stake to 32.7 percent
By Steve Slater and Matt Scuffham
LONDON, Sept 16 (Reuters) - Britain will sell a 6 percentstake in part-nationalised Lloyds Banking Group at aprice of at least 75 pence per share, raising over 3.2 billionpounds ($5.1 billion), three sources familiar with thetransaction said.
UK Financial Investments launched the sale of thegovernment's shares in Lloyds earlier on Monday, a milestone inthe country's recovery from the 2008 financial crisis, duringwhich taxpayers pumped a combined 66 billion pounds into Lloydsand Royal Bank of Scotland.
"We want to get the best value for the taxpayer, maximisesupport for the economy and restore them to private ownership,"a Treasury spokesman said.
Britain pumped 20.5 billion pounds into Lloyds during thecrisis, leaving taxpayers holding a 38.7 percent stake. The salewill reduce its stake to 32.7 percent.
Although the size of the stake being sold is lower than someanalysts had expected, it is still comfortably above that of theRoyal Mail, which is expected to raise between 2 and 3 billionpounds in its upcoming privatisation.
"It's a great signal it has been kicked off, the wheels havestarted to turn," said Chirantan Barua, analyst at Bernstein.
Shares in Lloyds closed on Monday at 77.36 pence and theaverage price at which the government bought the shares was 73.6pence.
Labour finance spokesman Chris Leslie said the sale shouldbe used to repay national debt.
"It's vital that taxpayers get their money back and thismust be the prime consideration in the sale of the government'sstakes in the banks," he said.
The sale is a vindication for Lloyds' Chief ExecutiveAntonio Horta-Osorio, who has restored the bank to profitabilitysince his appointment in 2011, simplifying the business to focuson lending to UK households and businesses.
Horta-Osorio said: "I believe this reflects the hard workundertaken over the last two years to make Lloyds a safe andprofitable bank that is focused on supporting the UK economy,"Horta-Osorio said."
The turnaround had prompted hopes the bank will start payingdividends again next year, having seen its shares double invalue over the past year.
"The focus on selling non-core businesses as well as costreduction has improved the bank's capital position to a pointthat it could return to distributing dividends to shareholdersin the medium term," said Paras Anand, head of European Equitiesat Fidelity Worldwide Investments.
UKFI, which manages the government's stakes in Lloyds andRoyal Bank of Scotland, said it had agreed not to sellany more shares in the bank for a period of 90 days. Thegovernment is expected to sell the shares in several tranches.
Bankers say later sales are likely to include an offering toprivate retail investors.
JPMorgan, Bank of America Merrill Lynch, UBS and Lazard arehandling the sale.
Timeline -
