UPDATE 1-MillerCoors Q3 income up, finds extra cost savings

* MillerCoors Q3 net income rises 28.1 percent

* Q3 beer sales rise 3.1 percent

* New $700 mln savings target over 3-1/2 years

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LONDON, Nov 4 (Reuters) - MillerCoors, the second-largest brewer in the United States, on Wednesday reported a 28.1 percent rise in third-quarter net income as it found an extra $200 million of cost savings resulting from its 2008 merger.

The combined U.S. operations of SABMiller Plc (SAB.L: Quote, Profile, Research) and Molson Coors Brewing Co (TAP.N: Quote, Profile, Research) with brands such as Miller Lite and Coors Light, said underlying net income in the quarter was $244.4 million with net sales up 3.1 percent to $2.01 billion in the July-September quarter.

The company, formed in July 2008, had said it would make $500 million of annual cost savings by the end of the third year of its combined operations, but now expects to make an extra $200 million by the end of 2012, to give a total of $700 million of savings over the first 4-1/2 years of its merger.

"We are delivering our synergies, controlling costs and managing revenue for sustainable profit growth," said MillerCoors CEO Leo Kiely in a results statement.

The brewer has a U.S. market share of nearly 30 percent behind Budweiser-brewer Anheuser-Busch InBev (ABI.BR: Quote, Profile, Research) share of around 50 percent.