UPDATE 3-Ameristar putting itself up for sale

* Hires Lazard, Bank of America Merrill Lynch

* Operates eight casinos

* JP Morgan names Boyd as potential buyer

* Shares rise 12.2 percent (Adds background, closing share price)

LOS ANGELES, Aug 11 (Reuters) - Ameristar Casinos Inc (ASCA.O) confirmed its board is considering selling the Las Vegas-based company, sending its shares up more than 12 percent.

The casino operator said on Wednesday it hired Lazard and Bank of America Merrill Lynch as its financial advisers and Gibson, Dunn & Crutcher LLP as legal adviser.

Talk of a potential buyout has swirled around Ameristar following the 2006 death of its founder and chief executive, Craig Neilsen, whose estate, including a more than 50 percent stake in Ameristar, went to a foundation that focuses on spinal cord research.

Analysts said a pending change in the tax treatment of estates is likely driving the latest sales process, which was first reported earlier on Wednesday by the New York Post.

"Under current estate tax laws, if the shares held by the estate are not sold by the end of 2010, the beneficiaries could face an estate tax of up to 55 percent," Deutsche Bank analyst Chris Woronka said in a research note.

JP Morgan analyst Joe Greff named Boyd Gaming Corp (BYD.N), which recently bowed out of bidding on assets auctioned by bankrupt Station Casinos Inc [STN.UL], as a potential buyer.

"We believe that Boyd may have an interest in Ameristar, since there is little geographical overlap and a potential deal would diversify it away from the Atlantic City and Las Vegas locals market," he said in a note.

Greff said other regional casino operators such as Penn National Gaming Inc (PENN.O) and Pinnacle Entertainment Inc (PNK.N) are less likely buyers, because both have other capital expenditures and greater geographic overlap than Boyd.

Ameristar operates eight casinos in seven markets, including the St. Louis, Denver and Omaha, Nebraska, areas, but does not have a presence in Las Vegas or Atlantic City, New Jersey.

It reported a net loss of $24.9 million last week compared with a year-earlier profit of $14.3 million, as it incurred charges related to its East Chicago property and company-wide revenue fell 5 percent to $293 million.

On Wednesday, Ameristar's shares rose $1.77 to close at $16.27 on Nasdaq, bringing the company's market capitalization to around $944 million. (Reporting by Deena Beasley; editing by Leslie Gevirtz, Gary Hill and Andre Grenon)