ABB CFO says looking into further buys - paper

* ABB CFO says to stick to strategy of small/mid-size buys

* Says acquisition better option than share buyback

* Says Q1 order trend in automation business has continued

ZURICH, June 25 (Reuters) - Swiss engineering group ABB (ABBN.VX) is looking into further acquisitions following its recent buys, the group's chief financial officer said in a newspaper interview.

ABB, which sells power equipment to utilities as well as to oil and gas companies, was analysing additions to its divisions, ABB CFO Michel Demare told Swiss financial newspaper Finanz und Wirtschaft.

"Very big deals in turn need a lot of time, cost a lot of money and can not always be realised," he said. "I am quite happy with our gradual approach taken so far."

"I would be not surprised if further takeovers in the size of 0.5 to 2 or 3 billion dollars were to follow," Demare said.

ABB announced an all-cash deal to buy Britain's Chloride Group CHLD.L for 860 million pounds ($1.25 billion) earlier this month, its second acquisition since May.

Demare said concerns the group was heading for a bidding war over Chloride with spurned U.S. suitor Emerson Electric Co (EMR.N) were unfounded. "We know our limits and we remain disciplined," he said.

The group, which competes with France's Schneider (SCHN.PA), had $7.1 billion in net cash at the end of the first quarter and had been expected to go on a buying spree.

Demare said that the net cash position at the end of this year could be around $5 billion if ABB refrained from further purchases. "So we will keep a lot of fire power," he said.

Acquisitions remained the better option than returning the cash to shareholders through buyback programmes, Demare said.

"I use to tell investors that we still see a lot of acquisition opportunities and that we want to increase the company's value in the longer run this way," he said.

Demare stuck to ABB's cautious outlook saying demand in the power sector would improve only slowly. "It will take at least two to three quarters until we are back at a normal order level," Demare said.

In the automation business, the trend of a bottoming out seen in the first quarter seemed to have continued, Demare said.

"Especially in Asia -- in particular in China -- sales in the automation business is seeming to pick up," he said.

ABB will publish second-quarter results on July 22.

Demare said the group was also well on track to achieve cost cuts of $3 billion by the end of 2010 compared to 2008 levels. (Reporting by Sven Egenter; Editing by Jon Loades-Carter)