Coca-Cola HBC leads Britain's FTSE share index higher

* Blue-chip FTSE 100 index ends 1.7 pct higher

* Coco-Cola HBC rises after Citigroup upgrade

* Ladbrokes gains after competition regulator decision

By Kit Rees

LONDON, May 20 (Reuters) - Britain's top share index endedsharply higher on Friday, with bottling company Coca-Cola HBC rallying on the prospects of a margin recovery andcommodities stocks partially recovering after slumping in theprevious two straight sessions.

The blue-chip FTSE 100 index finished 1.7 percenthigher, its biggest one-day percentage gain since mid-April.However, the benchmark index is still down 1.4 percent so farthis year.

Coca-Cola HBC jumped 6.4 percent after Citigroup raised itsrating on the stock to "buy" saying that concerns, whichincluded a potential naira devaluation and rising world sugarprices, were priced in and the company had the potential for avisible margin recovery opportunity.

"With the shares trading at a 5-year peak discount topeers...we feel these concerns are priced in, providing a goodopportunity to buy into improving fundamentals," Citi analysts said in a note.

Among sectoral gainers, the UK mining index rose 1 percent as metals prices recovered and some investorslooked for bargains after of a sell-off in the previous twosessions. The energy index also rose 1.7 percent.

Miners Anglo American, Glencore, Rio Tinto, BHP Billiton and Antofagasta rosebetween 0.4 percent and 3.6 percent.

Outside of the blue chips, bookmaker Ladbrokes surged 6.5 percent after the British competition regulator saidthat Ladbrokes and Gala Coral would have to sell between 350 to400 shops to win clearance for their merger.

Traders said that the number of shops the two firms wouldhave to sell were less than expected.

"The regulator's been softer on the deal. It's not a donedeal, but it's more doable now ... it's going in the rightdirection in favour of the merger," Zeg Choudhry, managingdirector at LONTRAD, said.

Electrical engineering company Spectris dropped 4.4percent, hitting a three-month low after posting a softerfirst-quarter results.

The company said that trading conditions in the periodcontinued to be challenging, and reiterated its 2016 oulook.

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If you have any thoughts, suggestions or feedback on this,please email mike.dolan@thomsonreuters.com.

Mike Dolan, Markets Editor EMEA. (Additional reporting by Atul Prakash; Editing by Toby Chopraand Angus MacSwan)