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Aareal Bank buys rival Corealcredit for 342 mln euros

* Aareal said deal to add to EPS from the start

* Pays less than Corealcredit's equity capital of 648 mln euros

* Deal bolsters Aareal's commercial property business

FRANKFURT, Dec 22 (Reuters) - German property lender Aareal Bank said on Sunday it would buy rival Corealcredit Bank AG from U.S. investor Lone Star for 342 million euros ($468 million) to bolster its commercial real estate mortgage business in its home market.

Aareal said the deal would top up its earnings per share immediately after completion of the transaction, which is expected during the first half of next year.

"We are further expanding our position as one of the leading providers of commercial property financing," Aareal chief executive Wolf Schumacher said in a statement.

Aareal said the transaction, which is to be funded from existing liquidity reserves, would create value for its shareholders from the start. It also said the bank would stick to a plan to resume dividend payments for the 2013 financial year.

Aareal said that partly to reflect the credit risks Corealcredit is exposed to, the purchase price is far below the book value of the target's equity capital - what is left of total assets after deduction of debt - of 648 million euros as per June 30.

Corealcredit Bank was acquired by Lone Star at the end of 2005. The U.S. firm slimmed down the bank to focus on commercial property financing in Germany, returning it to profitability in 2007.

Corealcredit has total assets of 7.6 billion euros, compared with Aareal's 43 billion.

The buyer said it had appraised Corealcredit's legal, tax and credit risks conservatively and that Lone Star had agreed to keep parts of these risks on its own books.

As early as February, people familiar with the matter had told Reuters that the deal was in the making.