* Shareholders can offer own price to sell shares
* Government ready to raise stake to 55 pct, can go as high as 65 pct
* Gives shareholders alternative to Marine Harvest hostile bid
* Would strengthen state's already strong hold over fish-farmer (Adds deal details, Marine Harvest fight)
OSLO, June 20 (Reuters) - Norway's government unveiled proposals on Thursday to buy another 11.6 percent of fish farmer Cermaq, offering at least some shareholders an alternative to Marine Harvest's hostile bid for the company.
Norway's trade ministry said it was prepared buy 10.75 million Cermaq shares in an auction starting Thursday, in which shareholders could declare to the government at what price they would be willing to sell their shares.
At current prices, that stake would be worth about $210 million and would take the government's holding in the company from 43.5 percent to over 55 percent. The trade ministry said it was ready to go as high as 65 percent depending on the offers it received.
Moving past the 50 percent threshold would reinforce the government's hold over Cermaq and gives it more options in what it does with the company going forward.
Oslo has been in a standoff with Marine Harvest, controlled by shipping tycoon John Fredriksen, in a rare battle, as most investors are not willing to bet against a state that controls such blue chips as Telenor and Statoil.
Fish farming stocks have been in high demand recently as limited global supply growth and healthy consumer demand are pushing fish prices higher, improving margins after several lean years.
Cermaq has repeatedly rejected Marine Harvest's approaches, saying it undervalued the company, and this week drew bids from private equity firms Bain and Altor to buy its fish feed subsidiary in an agreed deal worth $1.1 billion.
That deal alone was seen as putting another barrier in front of Marine Harvest's efforts but a government's increased stake is almost certain to thwart the hostile offer.
Oslo-born Fredriksen has had an uneasy relationship with Norway's centre-left government since giving up his Norwegian citizenship to escape high taxes.
Fredriksen, a billionaire who lives in London, has moved several of his companies out of Norway, most recently taking the management of drilling giant Seadrill to London. (Reporting by Balazs Koranyi and Victoria Klesty; editing by Patrick Graham)