UPDATE 1-Kier falls on plans to raise 264 million pounds via share sale

(Adds details on debt, share price, background)

Nov 30 (Reuters) - Kier Group Plc will sell shares to raise about 264 million pounds ($336.97 million), the British builder said on Friday, adding that lenders were looking to cut their exposure to the UK construction sector.

The company said it was planning to offer 64.5 million new shares at 409 pence per share, a discount of 46 percent to the company's Thursday close.

The FTSE-250 company's shares, which have fallen more than 43.5 percent so far this year, were down 17.3 percent at 1428 GMT.

The company, which has been trying to cut expenses as part of a cost-savings program, said the risks associated with its debt had worsened as a number of lenders indicated an intention to reduce their exposure to the construction sector.

The UK construction sector has come under increasing scrutiny since rival Carillion Plc collapsed this year.

Kier said proceeds from the offering would speed up its net debt reduction plans and strengthen its balance sheet.

The company also said its current trading and outlook for 2019 were in line with its expectations.

($1 = 0.7835 pounds) (Reporting by Arathy S Nair in Bengaluru; Editing by Bernard Orr and Shounak Dasgupta)