* $9 bln debt load puts Fortescue under stress
* Asset sales, equity raising still possible - investors
* Glencore would eye Fortescue if cheap enough - sources
* Fortescue updates on Q1 output, costs on Thursday
By Sonali Paul
MELBOURNE, April 16 (Reuters) - Australia's Fortescue Metals Group has two stark choices to deal with a crash in the iron ore market and cut its $9 billion debt pile - sell off stakes in its mines or transport infrastructure, or sell new shares.
Investors say the quickest capital-raising option for the world's No. 4 iron ore miner would be a rights issue, although that could lead to the dilution of the one-third stake held by Chairman Andrew "Twiggy" Forrest.
"There's no question, all of those things, in a challenging environment, get a run," said a person close to the company who asked not to be identified. "You've always got them on the agenda."
Fortescue, which has been ramping up output and cutting costs, updates its quarterly production and costs on Thursday, with investors anxious to see if it is burning through its $1.6 billion in cash as iron ore prices hover around $50 a tonne.
With valuable infrastructure and long-life mining assets, analysts say Fortescue is in better shape than smaller rivals like Atlas Iron, which last week moved to shut all its mines to stem losses.
But its debt load makes it more vulnerable than its much bigger rivals Rio Tinto and BHP Billiton, after it scrapped a $2.5 billion bond sale last month.
It could sell stakes in its mines, which are all 100 percent owned, unlike those of its rivals who already have partners. Or it could again try to sell a stake in its port and rail unit which it put up for sale in 2012 during a brief dip in iron ore prices.
"While the company's under duress, we believe it's unlikely to go bust, simply because there is strategic value in that infrastructure," said Ric Ronge, a portfolio manager at Pengana Capital.
In 2012, analysts estimated Fortescue could have raised up to A$4 billion by selling a minority stake in the port and rail, but such a price is unlikely now even if a buyer can be found.
While a rights issue may be a straight forward option, investors question the appetite and ability of top shareholders Forrest and China's Hunan Valin Iron and Steel Group to fund their share.
If the company sought to raise 15 percent of its equity value, Forrest would have to stump up A$277 million ($210 million) or see his stake diluted.
Forrest, a one-time stockbroker, fought a David-against-Goliath battle with Rio Tinto and BHP Billiton to build Fortescue into a 165-million tonne per year player.
Fortescue's strategic value, particularly to China, as an alternative source of iron to the mega producers, has fuelled speculation of a potential takeover.
Those likely to look at it include Chinese steel makers and commodities giant Glencore Plc.
Glencore has made no secret it wants to expand into iron ore following its approach to Rio Tinto and three people close to Glencore have told Reuters the company would be interested in Fortescue.
"Their cost profile is not great," a person close to Glencore said. "But at a price, we'd have a look."
$1=1.32 Australian dollars Additional reporting by James Regan in SYDNEY and Silvia Antonioli in LONDON; Editing by Lincoln Feast and Richard Pullin