Aer Lingus rejects takeover approach from British Airways owner

(Reuters) - Aer Lingus (AERL.I) has rejected a takeover approach from the owner of British Airways (ICAG.L), which is keen to gain control of the Irish airline's slots at London's Heathrow Airport.

Shares in Aer Lingus (AERL.I) surged as much as 20 percent on Thursday after the Financial Times reported that British Airways-owner International Consolidated Airlines Group (IAG) (ICAG.L) was considering a takeover bid.

IAG later confirmed its approach, but gave no details. "There can be no certainty that any further proposal or offer will be forthcoming," it said in a statement.

Aer Lingus said the approach undervalued its business, but also did not give details. At 11:15 EST, its shares were up 8.8 percent at 1.98 euros, giving it a market value of about 1.06 billion euros ($1.30 billion).

IAG shares were 4.2 percent higher at 462.5 pence.