MILAN (Reuters) - Italian defence group Leonardo launched on Monday an initial public offering of its U.S. electronics unit DRS, which counts the U.S. military as a customer. The parent company will offer about 31.9 million shares of Leonardo DRS, or a 22% stake, on the New York Stock Exchange for $20 to $22 per share, a filing showed, valuing the stake at up to $701.8 million. The state-controlled group said last month that it aimed to complete the listing by the end of March. Leonardo Chief Executive Alessandro Profumo has said the group would keep the majority of DRS - which it bought in 2008 in a deal valuing the U.S. defence company at $5.2 billion, including $1.27 billion in debt - to “maintain a significant exposure in this strategically important market”. The share sale will provide new financial resources for Leonardo, which saw its net debt increase to 3.3 billion euros ($3.94 billion) last year, from 2.8 billion euros in 2019. By 1210 GMT Milan-listed shares in Leonardo were up 1.9%, versus a 0.7% gain for Italy’s blue chip index. Leonardo will receive all the proceeds from the offering, according to the filing, while DRS intends to keep future profits for growth and does not anticipate paying a regular cash dividend. To get ready for the New York listing, DRS in February said it planned to repay $237 million of related-party borrowings and issue $450 million of new debt. Goldman Sachs, BofA Securities and JP Morgan are the lead underwriters for the offering. Barclays, Citigroup, Credit Suisse, and Morgan Stanley will act as book-running managers, while Credit Agricole, IMI-Intesa Sanpaolo, MUFG and UniCredit Capital Markets will act as co book-running managers for the proposed offering. Mediobanca is acting as financial advisor for Leonardo. ($1 = 0.8386 euros)