UPDATE 1-Battered Luckin Coffee gets $240 million investment

(Adds details on investment, background on accounting fraud)

April 15 (Reuters) - China’s Luckin Coffee Inc said on Thursday it would receive a $240 million investment from two shareholders, as the coffee chain tries to recover from an accounting fraud last year that derailed its business.

Chinese private equity firm Centurium Capital will lead the investment in exchange for preferred shares, while Joy Capital will also participate, the company said.

The company said the firms have the option to raise their investment by an additional $150 million.

Xiamen-based Luckin had positioned itself as an ambitious home-grown challenger to U.S. coffee giant Starbucks Corp SBUX.O>, but said last April that as much as 2.2 billion yuan ($337.31 million) in 2019 sales had been fabricated.

The company, which was fined $180 million by the U.S. Securities and Exchange Commission, said in February it was seeking protection under Chapter 15 of the U.S. Bankruptcy Code to facilitate the restructuring of its debt.

The new investment will be used to help pay off the fine and grow its core coffee business and is subject to a series of closing conditions, including the implementation of a restructuring of $460 million worth of bonds, Luckin said.

$1 = 6.5222 Chinese yuan renminbi Reporting by Uday Sampath in Bengaluru; Editing by Arun Koyyur and Sriraj Kalluvila