* ASX sees business logic of merger with SGX

  * FIRB process may take as much as 120 days

  * Aberdeen says deal chances higher than market expectations (Adds comments from Aberdeen, source)

  SYDNEY/SINGAPORE, March 24 (Reuters) - Australian bourse operator ASX says it continues to believe in the business logic of a proposed $7.6 billion takeover by Singapore rival SGX and also sees a need to take part in global bourse consolidation.

  The ASX made the comments in a letter to shareholders released Thursday as it ramps up lobbying efforts to try to overcome political opposition to the deal, which comes amid a wave of bourse consolidation globally.

  ASX shares, which fell earlier this week on media reports that the government was set to reject the merger, edged up 0.3 percent to A$34.64 at 0310 GMT. SGX shares were down 0.32 percent in late afternoon trade.

  " The ASX Board maintains a strong belief in the need to participate in global exchange consolidation and in the business logic of the announced combination with Singapore," it said in a statement.

  " The recent merger announcements by the London and Toronto exchanges as well as by NYSE Euronext and Deutsche Borse, underscore the dynamic forces driving developments among global exchanges."

  The deal is currently under review by the Foreign Investment Review Board (FIRB), which has up to 120 days to make a decision.

  A source with knowledge of the deal said the SGX filing with FIRB " is a long application and in a complicated manner. It may take longer than a standard application."

  But he said SGX is unlikely to give more concessions as stated by CEO Magnus Bocker.

  " They don't want do anything at all cost. It is a very good deal for SGX and makes sense for ASX shareholders and Australia," the source said.

  SGX's bid for ASX, first announced in October, has already been under pressure from Australian politicians -- whose approval is necessary to lift a 15 percent shareholder cap -- because it was seen as ceding control over a key national institution and a de-facto monopoly.

  Peter Elston, a strategist at Aberdeen Asset Management Asia, which owns both ASX and SGX shares, said he senses there is a better chance of the deal going through than what the market believes.

  " The fact of the matter is that ASX doesn't perform a regulatory function. It's just an exchange. The regulatory function is outside the exchange," Elston said. He said the deal will go through once the politicians realise they are not putting a regulatory function in foreign hands and an exchange does not have to be a monopoly.

  Elston said if the deal is not approved, it will be bad for ASX.

  " I don't imagine there will be too many others who are interested in ASX because they know it will very likely get blocked by the regulators."

  The deal faces several key hurdles: first it needs approval from the Treasurer after the FIRB comes up with a recommendation. Then Parliament has to agree to lifting a 15 percent shareholder cap in ASX, and finally, it needs approval from ASX and SGX shareholders. (Reporting by Michael Smith and Balazs Koranyi additional reporting by Saeed Azhar and Harry Suhartono in Singapore Editing by Matthew Driskill)