* Finland's Kone ( KNYJF ) to buy TK Elevator in cash and stock

deal

* Set to become world's largest elevator group

* Sellers are private equity groups Advent and Cinven

* Plans cost cuts of 700 million euros

* Facing antitrust hurdles

(Adds transaction detail in paragraphs 1, 3-4, 8-9)

HELSINKI, April 29 (Reuters) - Finnish lift maker Kone ( KNYJF )

said on Wednesday it had agreed to buy its German

rival TK Elevator in a cash and stock transaction valued at 29.4

billion euros ($34.4 billion), which would create ​the world's

largest lift maker.

The deal with private equity firms Advent International and

Cinven marks one of Europe's biggest takeovers this year and is

also the highest valued company takeover in Finnish history.

Kone ( KNYJF ) will pay 5 billion euros in cash upon closing and issue

a further 270 million new shares worth around 15.2 billion

euros, corresponding to 33.8% of all issued shares and 18.3% of

total votes.

In addition, Kone ( KNYJF ) will take on TK Elevator's

interest-bearing net debt, amounting to about 9.2 billion euros,

which it plans to refinance.

The combination would result in planned cost savings

estimated at 700 million euros on an annual run-rate basis, Kone ( KNYJF )

said.

"This combination would meaningfully enhance our ability to

meet customers' growing demand for reliable and sustainable

solutions and services," Kone ( KNYJF ) CEO Philippe Delorme said in a

statement.

Kone ( KNYJF ) shareholders owning 40.3% of all outstanding shares and

approximately 74.3% of the total votes have agreed to support

the transaction and vote in favour of the board's proposals, the

group said.

ANTITRUST HURDLES

For the last financial year, the combined group's annual

sales would be about 20.5 billion euros, 65% of it from its

service and modernisation business, Kone ( KNYJF ) said.

The combined adjusted operating profit (EBIT) excluding any

cost synergies stood at more than 2.7 billion euros, the company

added.

Analysts have said a deal of this size will likely face

close scrutiny by antitrust authorities, given the global

elevator and escalator market is already highly concentrated and

dominated by a small number of multinational players.

If approved, the merger would make Kone ( KNYJF ) the world's largest

lift maker by market value, overtaking its biggest rivals,

U.S.-based Otis valued at $29.7 billion and

Switzerland's Schindler at $36.2 billion.

Japan's Mitsubishi Electric ( MIELF ) and Hitachi ( HTHIF )

have bigger market valuations but for them elevators are only

one business segment among many.

Schindler has already said it would challenge a deal between

Kone ( KNYJF ) and TK Elevator before antitrust authorities.

($1 = 0.8546 euros)