Britain's FTSE hits 6-week high, SABMiller rises on higher bid

* FTSE 100 gains 0.8 pct

* Anheuser-Busch lifts SABMiller (Xetra: BRW1.DE - news) bid to 42.15 pounds/share

* Miners rally, set longest winning streak since Feb. 2014

* Tesco (Xetra: 852647 - news) falls after reporting profit slump

By Alistair Smout

LONDON, Oct (HKSE: 3366-OL.HK - news) 7 (Reuters) - Britain's FTSE 100 rose to its highest level since August on Wednesday, buoyed by a rise in mining stocks and SABMiller, while Tesco fell after reporting that profits more than halved.

The FTSE 100 was up 47.54 points, or 0.8 percent at 6,373.70 points by 0752 GMT, up for its fifth straight session and hitting its highest level since Aug. 20.

SABMiller rose 2.9 percent after Anheuser-Busch InBev, the world's largest brewer, increased its bid to 42.15 pounds per share in cash, valuing the company at nearly 68 billion pounds.

"Our positive stance on SABMiller has been predicated on the view that SABMiller was an industry consolidation target," Numis Securities analysts said in a note, rating SABMiller as a "buy".

"In our opinion, there is a strong strategic and financial rationale for a merger of AB InBev and SABMiller and we believe that 42.15 (pounds a share) is an attractive offer for SABMiller (Amsterdam: MI8.AS - news) shareholders."

The market was also supported by a rebound in the mining sector, which rose 4 percent. The sector was buoyed by a rally in metals prices, and is up for a seventh straight day, its longest winning streak since February 2014.

It (Other OTC: ITGL - news) is up more than 20 percent since hitting its lowest levels since 2008 at the end of last month on concerns over the strength of growth in China, the world's top consumer of metals.

Tesco fell more than 3 percent to be the top FTSE 100 loser after reporting a collapse in first-half profit. The heavy cost of rebuilding the business was evident even as it said its turnaround plan was starting to work.

Shares (Berlin: DI6.BE - news) in Tesco were off their lows, trading down about 2 percent, with some seeing positives in the update.

"As expected, Tesco has recorded a chunky decline in profitability, but has seen first half sales in the UK start heading in the right direction," Retail Insights at Kantar Retail director, Bryan Roberts, said in a note.

"An overhaul of the large store proposition remains an elusive component of a sustained recovery. That said, Dave Lewis has successfully corrected the direction of travel and the stage is set for some meaningful action on value," referring to Tesco's chief executive officer.

Replacing Tesco as top fallers on the index were airlines IAG and easyJet, down 4.1 percent and 3.2 percent respectively after Credit Suisse (LSE: 0QP5.L - news) cut the sector to "equalweight" from "overweight", saying that a stabilisation in the oil price will hit the industry. (Editing by Louise Ireland)