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UPDATE 1-Japan Post share sale raises $11 bln after solid demand

* Govt raising 1.2 trillion yen from share sale -filing

* Price is 2 percent discount to Monday's close

* Price is 6 pct below 2015 IPO price (Recasts, adds market comment)

TOKYO, Sept 25 (Reuters) - Japan Post Holdings Co priced a major government sale of its stock at a 2 percent discount to its Monday closing price, valuing the offering at $11 billion and making it the world's second-largest this year.

That compares with an indicative range of a 2-4 percent discount to firm's closing price that had been flagged by the sale's underwriters.

The value of the deal could later total some 1.3 trillion yen ($11.6 billion) if an overallotment of shares is fully taken up.

Although there had been worries earlier in the sale process that M&A missteps by Japan Post as well as lack of clear growth prospects would blunt appetite for the offering, the firm's relatively robust dividend yield lured domestic retail investors in particular.

"Our customers buy stocks to hold as long-term assets. Japan Post is a stock our conservative customers like," said Koji Taki, heads of sales at Imamura Securities Co.

He noted that the firm's dividend yield of about 3.7 percent compared favorably with the average Japanese bank deposit rate of 0.001 percent.

The sale was the first since the 2015 triple initial public offerings for the postal firm and its two units that are major financial firms in their own right - Japan Post Bank Co Ltd and Japan Post Insurance Co Ltd.

Japan Post said in a filing that the government is offering 929 million shares at 1,322 yen, some 6 percent below its IPO price of 1,400 yen. The size of the overallotment will be determined on Wednesday.

The offering is set to be the second-largest in the world so far this year, after Italian bank UniCredit's $13.7 billion share issue in February. ($1 = 112.2600 yen) (Reporting by Taiga Uranaka; Editing by Edwina Gibbs)