PepsiCo's chairman and CEO believes "everyone is interested" in merging with Danone, but feels the company is "very expensive." Speaking to Le Figaro Entreprises, Steve Reinemund refused to speculate on whether Coca Cola Co would make an offer for the French group, but said that "everyone is clearly interested in a merger of this type.

"Danone is a very well-managed company which is succeeding admirably," Reinemund said. "But you have to wonder how that could bring value to shareholders. When you see that a company is already perfectly managed and you don't see how you could do better, it would not be any use buying it. Especially if it is very expensive."

Earlier this year, Danone's chairman Franck Riboud denied rumours of an imminent takeover bid. He told The Wall Street Journal: "If you ask me if I want (to be taken over), the answer is no; I'd fight against it. The best protection is to forget these rumours and deliver what our shareholders expect of us."

Unilever, Nestle, Coca-Cola Co. and Kraft Foods Inc. have been linked to the French group.