UPDATE 3-Stratasys receives $1.21 bln unsolicited buyout proposal from 3D Systems

(Updates June 1 story with share price in paragraph 2 and 3D Systems comment in paragraph 7)

June 2 (Reuters) - Stratasys Ltd said on Thursday that it had received an unsolicited buyout proposal from rival 3D Systems Corp, valuing the industrial 3D printer at about $1.21 billion.

Stratasys shares were up 10.1% at $16.04, while 3D Systems was up 2.6% at $8.55 in premarket trading on Friday.

3D Systems' proposal could trigger a bidding war for the company, which has rejected multiple takeover offers from shareholder Nano Dimension Ltd as it looks to merge with Desktop Metal Inc in a $1.8 billion stock deal.

3D Systems has proposed to acquire Stratasys for $7.50 in cash and 1.2507 of its newly issued stock for each share of the target company, which translates to $17.92 on a per-share basis.

That, however, falls slightly short of Nano's cash offer of $18 per share. Nano is the largest shareholder of Rehovot, Israel-based Stratasys, with a 14.2% stake.

Stratasys said its board would "carefully review" the newly received non-binding proposal, adding that the Desktop Metal deal is still expected to close in the fourth quarter of this year.

3D Systems on Friday confirmed its bid for Stratasys and said that if the deal goes through, it will bring $100 million in cost synergies. (Reporting by Jaiveer Singh Shekhawat and Shivansh Tiwary in Bengaluru; Editing by Shilpi Majumdar, Anil D'Silva and Shounak Dasgupta)