UK's FTSE lifted by hopes of Greek deal, bid speculation

* Hopes of Greek debt deal lift European equity markets

* FTSE up but lags gains on euro zone markets

* Sky (Other OTC: BSYBF - news) , Severn Trent (Other OTC: STRNY - news) rise on bid speculation

* Thorntons (LSE: THT.L - news) surges after bid from Ferrero

By Sudip Kar-Gupta

LONDON, June 22 (Reuters) - Britain's benchmark equity index rallied on Monday, as bid speculation boosted media group Sky (LSE: SKY.L - news) and utility Severn Trent, while hopes of a Greek debt deal lifted stock markets worldwide.

The blue-chip FTSE 100 equity index rose 1.4 percent to 6,803.36 points, near its highest level in around two weeks though lagging gains in euro zone markets, with Germany's DAX bouncing 2.6 percent after the European Union welcomed a new offer by Greece on a reform package.

Sky was among the best-performing FTSE 100 stocks, rising 4.3 percent after The Sunday Telegraph newspaper reported that the Murdoch family might be planning a new attempt to take full control of Sky.

Severn Trent advanced 2.6 percent after the Sunday Times reported Canadian investment company Borealis Infrastructure was considering a bid, while small-cap chocolate firm Thorntons surged 40 percent after Ferrero International made a bid.

Given previous instances of hopes of an easing of Greece's debt crisis being thwarted, some traders remained cautious.

"I'd rather wait to see them sign on the dotted line on Greece and then buy into the market, rather than buy into it right now," said Hantec Markets analyst Richard Perry.

The FTSE 100 is up around 4 percent since the start of 2015, although it is down by a similar amount from a record high of 7,122.74 points reached in April. (Reporting by Sudip Kar-Gupta; editing by John Stonestreet)