The battle for control of the Serbian drinks group Knjaz Milos has heated up, with the UK-based fund FPP Balkan accusing a Serbian minister of favouring the Danone-led bid for the business, despite the fact it was for less money than FFP's bid.

As just-drinks reported earlier this week, over the weekend both Danone and FPP Balkan claimed victory in the fight for the Serbian drinks firm after it was put up for auction by the Serbian government.

Today, FPP's representative in Serbia, Srdjan Muskatirovic said: "The Securities Commission decided yesterday to disqualify Danone but while the statement was being prepared, Deputy Prime Minister Miroljub Labus phoned in and stopped the decision."

According to a Reuters report, both Danone and Labus declined to make any comment.

The report said a source close to the securities watchdog believed the Securities Commission had abruptly cancelled a news conference at which it had planned to declare Danone's bid invalid.

Small shareholders in Knjaz are expected to take the issue to parliament this week to demand to know why the Danone bid was not disqualified.