SYDNEY, Dec 7 (Reuters) - Australian fund manager Perpetual Ltd shares rose 10% in early trade on Thursday after it rejected a A$3.1 billion ($2 billion) takeover offer from its largest investor, raising the prospect of a bidding war for the firm.

Perpetual stock hit the highest level in four months at A$25.93 after the company turned down Washington H Soul Pattinson's (WHSP) bid valuing it at A$27 a share.

The bid, which would see Perpetual's asset management business spun off, came hours after Perpetual announced a strategic review to examine a similar move.

WHSP's offer was the second Perpetual has rejected in just over a year after it turned down a A$33 per share offer from Barings Private Equity Asia (BPEA) and Regal Partners.

"It now seems to be in play. With one bid on the table, we would be surprised if further bids did not appear," Bell Potter analyst Marcus Barnard wrote in a note to clients.

The A$3.1 billion offer would consist of A$1.06 billion worth of WHSP scrip and A$2 billion worth of Perpetual Asset Management scrip as part of the spin off of that business.

"An opportunistic offer, we expect Perpetual shares will price in the likelihood of an enhanced bid along with potential third-party interest from the strategic review," UBS analyst Shreyas Patel wrote.

WHSP shares were down 2.1% early Thursday.

($1 = 1.5270 Australian dollars) (Reporting by Scott Murdoch; Editing by Stephen Coates)