UPDATE 1-Share fall punctures Pirelli's market comeback

(Adds details, quotes)

MILAN, Oct 4 (Reuters) - Shares in Italy's Pirelli fell on the tyremaker's return to the Milan stock exchange after a two-year absence that resulted from a takeover led by China National Chemical Corp (ChemChina).

Pirelli priced its initial public offering at 6.5 euros per share, valuing the maker of tyres for Formula One racing teams and upmarket brands such as BMW, Audi and Mercedes at 6.5 billion euros ($7.65 billion).

That price was at the lower end of an initial range of between 6.3-8.3 euros per share.

The stock was down 1.7 percent at 6.39 euros per share by 0745 GMT, with a trader saying it was "still considered valued too high, so people are selling".

The relisting will test demand for a streamlined firm that focuses on high-end consumer tyres after its less profitable truck and industrial tyre business was folded into part of ChemChina.

Despite being one of Italy's best-known corporate names, investors had raised concerns over Pirelli's debt pile, complex governance structure and risk that one of the existing minority shareholders could sell once a lock-up expires.

Chief Executive Marco Tronchetti Provera sought to play down any disappointment over the muted market debut. "We'll have to see in a few months. We know the company is solid and will bring results ... there's always volatility during the first days," he said.

The world's fifth-largest tyremaker placed 40 percent of its share capital with investors, raising between 2.3-2.6 billion euros for its owners through the IPO, depending on whether the overallotment option will be exercised.

Pirelli had traded on the Milan stock exchange since 1922 but was de-listed in 2015 after state-owned ChemChina took a 65 percent stake in Marco Polo, the holding company controlling the tyremaker.

Through the IPO, the Chinese reduced their stake to 45 percent plus 1 share, also in a bid to show Beijing has a cooperative approach to investments in Europe.

That shareholding could still change slightly depending on whether the banks exercise the overallotment option. (Additional reporting by Giancarlo Navach; Editing by Keith Weir)