UPDATE 2-Babcock Infrastructure plays down rival RBS bid talk

* Strong shareholder support so far for Brookfield plan - BBI

* BBI says talk of rival RBS-led bid "just noise" (Recasts with BBI CFO comments)

SYDNEY, Nov 12 (Reuters) - Debt-laden Australian asset manager Babcock & Brown Infrastructure BBI.AX urged investors to approve a $1.6 billion rescue plan backed by Canada's Brookfield group (BAMa.TO), saying no rival plan from Royal Bank of Scotland was on the table.

RBS (RBS.L) was putting together an A$1.5 billion ($1.4 billion) counterproposal which it planned to submit if the Brookfield (BIP.N) plan was voted down, the Australian Financial Review reported on Thursday, citing an unnamed RBS source.

BBI Chief Financial Officer Jonathon Sellar told Reuters there was strong support for the Brookfield plan, in which the Canadian group would buy BBI shares and assets to help the firm cut its near A$9 billion in debt and stave off insolvency.

"Our expectation is ordinary shareholders and (preference) holders will vote on Monday and vote for the transaction to go ahead," CFO Jonathon Sellar said.

"So far the voting trend we've seen is very, very positive," he said, with 98 percent so far in favour out of the 30 percent of the group's ordinary and preference shareholders (BEPPA.AX) who have voted.

Sellar said rumours of a transaction put together by RBS were just noise distracting shareholders from the vote on the Brookfield plan.

The AFR said RBS will give details of the bid if BBI investors reject Brookfield's plan. RBS was trying to get holders of BBI's preference shares, mostly hedge funds, to back its alternative plan, BBI said. RBS would be unlikely to put any of its own money into the plan, said a source outside RBS.

RBS, which acted on behalf of international hedge funds in two previous recapitalisation plans for BBI, declined comment.

RBS, majority owned by the UK government after almost collapsing during the financial crisis, has been selling most of its assets in the Asia-Pacific region to cut its debt and focus on its home market.

BBI said in September it knocked back the initial proposals from the RBS-led group because they did not offer shareholders enough certainty and would not have reduced the group's heavy gearing. RBS has not come forward yet with any other plan, BBI said.

Any transaction would need the approval of BBI's lenders, which include RBS.

It has told BBI that it is not backing the rumoured counter proposal being put together by another arm of RBS, Sellar said. "The only transaction they have support for is the current proposal with Brookfield," he said.

BBI has a market value of just A$91 million, but what makes it attractive are its infrastructure assets worth about A$12.5 billion, including Australia's biggest coal terminal, Dalrymple Bay, along with gas pipelines and railways in Australia and Britain's PD Ports.

BBI's troubles were sparked by the global financial crisis, which cut off its access to debt markets. It has about A$3 billion in debt maturing in stages by July 2011. BBI has said it risked insolvency without the recapitalisation. (Reporting by Denny Thomas and Sonali Paul; Editing by Lincoln Feast)