* Regulator AMF seen unlikely to use sealed bid process yet
* Seen continuing with accelerated auction procedure
* Club Med tussle is France's longest takeover battle
By Matthieu Protard and Pascale Denis
PARIS, Dec 4 (Reuters) - France's financial regulator is speeding up the auction for Club Mediterranee in an effort to end the uncertainty for shareholders, but is likely to hold back from asking for sealed bids for now due to legal risks of a possible tie, lawyers said.
There have been six offers from two rival bidders for the French holiday company. The first dates back to May 2013, and the latest was on Dec. 1.
Including a long period of legal wrangling that froze the process, the battle between Chinese billionaire Guo Guangchang and Italian tycoon Andrea Bonomi is the longest in French stock market history.
Regulator AMF's rules, aimed at making sure the interests of shareholders are served, allow it to intervene after 10 weeks have elapsed. It has two tools at its disposal -- shortening the period one party has to make a counterbid, and calling for "final counterbids" on a given date, with the highest winning.
"This threat has often been brandished but I don't think AMF will want to use the final counterbids procedure given legal risks," said Aline Poncelet, partner at law firm Paul Hastings.
Uncertainty over the outcome is weighing on the business of Club Med, which is already struggling with losses and a weak economy in Europe, its management has said.
Guo and his Fosun group on Monday offered 23.50 euros a share, topping Bonomi by 50 cents, and valuing the all-inclusive holiday pioneer at 897 million euros ($1.1 billion).
Using its accelerator tool for the first time on Nov. 13, the AMF gave Fosun only 12 working days to decide whether to bid again, down from 20 normally. Bonomi now has a matching 12 days, until Dec. 17, to sweeten his offer.
If Bonomi responds, legal experts expect the AMF to stick with its accelerated process, possibly cutting the counterbid period further. Its rules show it can go as low as three days.
Lawyers say one reason the AMF is reluctant to call for sealed bids is the risk of two offers at the same price. Bidders may then have to disclose additional and often sensitive information on their business plans to convince minority shareholders to tender their shares, they say.
"The process becomes a bit of a lottery, a bit angst-creating," said another lawyer, who asked to remain anonymous.
Poncelet said there should also be a natural end to the auction, once offerors see the price go to a level where their business plan sums no longer add up.
"There is no need to use the last auction process," she said.
Aside from the damage the uncertainty may yet cause to their investment, shareholders have done well from the battle to date. Club Med shares are up 70 percent since the saga began.
An AMF spokeswoman said that the regulator was "at this stage" still looking at one offer at a time. (Writing and additional reporting by Dominique Vidalon; Editing by Mark Potter)