European equities hit multi-year high, leisure stocks lead
* FTSEurofirst 300 index rises 0.2 percent
* Intercontinental Hotel gains on M&A talk
* Travel and leisure index top gainer in Europe
By Atul Prakash
LONDON, May 27 (Reuters) - European shares advanced on Tuesday, with a major index climbing to its highest level in more than six years, supported by the travel and leisure sector that rose on mergers and acquisitions talk.
The STOXX Europe 600 Travel and Leisure index rose to its highest since 2007 and was up 1.2 percent by 1042 GMT, the best sectoral gainer in Europe, led by Intercontinental Hotel Group after media reported deal interest from an unidentified bidder in the United States.
Shares in Intercontinental Hotel Group (IHG) surged 4.5 percent, the top performer on the pan-European FTSEurofirst 300 , which was up 0.2 percent at 1,378.51 points after climbing to its highest levels since early 2008.
Sky News, citing unidentified sources, said the world's largest hotelier, IHG, had rejected a 6 billion pound ($10.1 billion) takeover offer from a U.S. bidder on the grounds it was too low. A spokeswoman for the company declined to comment on the report.
"There is a lot of cash on corporate balance sheets and there is a big incentive for them to go out and deploy that cash to generate growth and cost synergies," Henk Potts, equity strategist at Barclays Wealth, said. Continuación...