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) and Molson Coors Brewing Co (TAP.N) 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) share of around 50 percent.