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* Murray Goulburn offers A$9/shr vs Saputo's A$8/shr
* Counter-bids from Saputo, Bega still likely - analyst
* WCB share open delayed; nearly doubled since initial Bega approach (Adds comments from company, analyst; share price; detail)
Nov 13 (Reuters) - Murray Goulburn Co-operative Co Ltd, the second-biggest shareholder in Warrnambool Cheese and Butter Factory Co Holdings Ltd, raised its takeover offer for the Australian dairy company to A$505 million ($470 million), trumping Canada's Saputo Inc's bid.
Murray Goulburn, Saputo and top WCB shareholder Bega Cheese are locked in a three-way battle for WCB, banking on increasing Asian demand for its basic dairy produce and high-tech milk extracts.
"There's every reason to think Saputo and Bega will still stay in the game" despite the soaring price, said Shannon Rivkin, director at Rivkin Securities in Sydney.
Shares in WCB, which have almost doubled since Bega kicked off the bidding war in September, were on a delayed open after closing at A$8.54 on Tuesday. Bega shares rose as much as 5.3 percent early on Wednesday.
Murray Goulburn's A$9 per share cash bid for WCB is a 20 percent increase on its earlier offer and a 12.5 premium to Saputo's offer.
"(Murray Goulburn), when combined with WCB, will be uniquely positioned with scale and capacity to capture the unfolding long-term opportunity in international dairy markets," Murray Goulburn Chairman Philip Tracy said in a statement on Wednesday. "The combined company will keep profits in Australia and return them to local farmers under the co-operative's objectives of maximising farm-gate returns."
The deal is conditional on approval from Australia's competition regulator and on gaining more than 50 percent acceptance from shareholders.
Saputo, Canada's largest dairy producer, on Tuesday won a recommendation in the absence of a higher offer from the WCB board and regulatory approval from the Australian government for its bid.
WCB said its directors would meet shortly to consider the revised Murray Goulburn offer.
Bega, which owns 18 percent of WCB, said last week it was considering whether to sweeten its cash and share bid after receiving approval from Australia's competition regulator to make an offer.
Murray Goulburn, which has secured a new A$350 million debt facility from its existing financiers for the bid, said it would seek to maintain and extend joint-venture and supply relationships with its current partners.
Industry heavyweights including New Zealand's Fonterra Co-Operative Group Ltd , the world's largest diary exporter, and Japan's Kirin Holding Co Ltd, have taken stakes in Bega and WCB respectively, with intent to influence the consolidation in the Australian dairy industry.
Fonterra and Kirin's local Lion food and beverage units have important relationships with Bega and WCB for the supply of dairy products in Australia.
$1 = 1.0734 Australian dollars Reporting by Lincoln Feast; Editing by Stephen Coates