* Murray Goulburn seeks time for regulators to approve bid
* Bega, Murray Goulburn say revised Saputo bid denies access to franking credits (Adds details on Murray Goulburn's competition requirements, context)
By Jackie Range
SYDNEY, Nov 27 (Reuters) - Murray Goulburn Co-operative Co Ltd appealed to takeover regulators on Wednesday to block a revised bid from Saputo Inc for Australia's oldest dairy maker, as it seeks time for its own offer to win approval from a competition watchdog.
The move marks an escalation of hostilities in the three-way takeover battle between Saputo, Canada's largest dairy maker, Murray Goulburn and Bega Cheese Ltd to buy Warrnambool Cheese and Butter Factory Co.
The Saputo and Bega offers close in mid-December, so Murray Goulburn is fighting against the clock to persuade regulators that the benefits of its bid to create an Australian dairy champion outweigh competition concerns. At stake is control of a key exporter of high-tech dairy products in demand in Asia.
"What Murray Goulburn are saying is ... the export potential for aggregated Australian dairy co-ops supersedes whatever negative competition effect there may be in the domestic market," said John Kettle, a partner with law firm McCullough Robertson and an expert on competition law.
Murray Goulburn asked the Australian Takeovers Panel to force Saputo to drop its revised Warrnambool offer, and that Saputo be prevented from processing acceptances for its A$505 million ($463 million) offer until the issue is settled.
The panel said it had not decided whether to conduct an inquiry and made no comment on the merits of the application.
Warrnambool said in a separate statement it disagreed with the basis of Murray Goulburn's application but declined to comment further. Saputo said it has followed takeover guidelines. Bega could not immediately be reached for comment.
Murray Goulburn's A$9 per share bid needs approval from the Australian Competition Tribunal, meaning it cannot make an unconditional offer. The tribunal will take three to six months to decide, by which time Warrnambool shareholders could have already decided to accept a rival bid.
Analysts say the Melbourne-based company sought approval from the tribunal instead of the better-known Australian Competition and Consumer Commission because the tribunal has a broader remit than simply considering competition.
A Murray Goulburn spokesman confirmed the company would make a tribunal submission by Nov. 29 but declined to comment further.
Saputo declared its A$9 bid, which is backed by the Warrnambool board, unconditional on Monday and said it would hike its offer if it won control. The Canadian dairy maker said on Wednesday it had acceptances totalling 4.8 percent of Warrnambool.
Murray Goulburn and Bega, which hold around 18 percent each of Warrnambool, argue the decision under Saputo's revised offer to drop A$1.31 per share in proposed dividends means shareholders will not have access to A$0.56 in franking credits.
On that basis, the value of the bid has fallen from A$9.56 to A$9.20 if 50 percent acceptance is achieved, they said.
Murray Goulburn is asking the Takeovers Panel to order that Warrnambool reinstate the dividends. ($1 = 1.0914 Australian dollars) (Editing by Stephen Coates)