CORRECTED - UPDATE 1-Czech CEZ board proposes 10 pct share buyback

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PRAGUE, April 23 (Reuters) - The board of CEZ , central Europe's largest power firm, is proposing to buy back 10 percent of the firm's shares to cut capital and meet option scheme requirements, documents at a shareholders meeting on Monday showed.

The documents, obtained by Reuters ahead of the meeting, showed the board was proposing to buy back 59.22 million shares in a range of 300 to 2,000 crowns per share within the next 18 months.

The proposal is in line with market expectations. The government earlier announced it would sell around 7 percent in CEZ, to raise funds to fill a hole in the budget.

"Favourable conditions for such a step (a share buyback) have been created by the recent decision of the Czech government to sell up to 7 percent of state shares in CEZ," the proposal for the AGM said.

"However, the company wants to carry out the buyback itself in a wholly transparent and undiscriminatory manner by buying stock on regulated markets," it added.

The state holds 67.6 percent in CEZ and the company has long said it would seek to mop up any flood of shares on the market.

Given the state's majority position, the proposal is likely to be easily accepted at the AGM.

CEZ shares traded at 996.5 crowns at 0814 GMT, up 0.96 percent. The Prague bourse's broader PX index was up 0.1 percent.