On Wednesday, Anglo-Dutch oil and gas company Royal Dutch Shell agreed to buy Britain's BG Group in a $70 billion cash and stock deal.

The acquisition marks the biggest deal of oil and gas industry in at least a decade. Shares of BG rallied 37% after purchase announcement.

The deal still needs to be approved by both firms' shareholders. BG Group shareholders will get 383 pence ($5.70) in cash, plus 0.4454 Shell B shares for each BG share.

In opening deals, the FTSE 100 index gained 37.1 points or 0.5% to 6,996.4, having closed 128.31 points higher yesterday. European markets were mixed, with the Dax 30 index in Frankfurt losing 0.2%.

The mega-merger came amid a slump in oil prices. Augustin Eden at Accendo Markets said, "The decline in oil price over the past year has battered some stocks which are clearly now looking attractive. In the last year BG shares fell 30%, shares in Tullow Oil have fallen 65%, Premier Oil down 55%, and Petrofac down 20%".

Shell said the deal would produce financial gains of around $2.5 billion a year. It also represents an opportunity for both firms to cut overlapping costs at a time when the energy sector is vulnerable to low oil prices.

Meanwhile Sky Plc advanced 2.9% after Reuters said Vivendi SA is looking to acquire the UK pay-TV provider. Experian Plc added 2.5% after Credit Suisse Group AG boosted its rating on the credit-reporting firm to the equivalent of a buy.

The FTSE 100 Index added 0.4% to 6,992.15 at 8:55 am in London. The benchmark gauge has climbed 2.7% in the last four days after a 2.5% fall last month. The FTSE All-Share Index also climbed 0.4%, while Ireland's ISEQ Index increased 0.7%.