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French foods group Danone SA said on Sunday it was not conducting a strategic review of assets and had not decided on any priority in terms of possible external growth possibilities.

The maker of Activia yoghurt and Evian water made the comments after sources familiar with the matter told Reuters on Friday Danone had decided it wants to pursue a takeover of U.S. infant formula maker Mead Johnson Nutrition Co.

Danone had declined to comment on the story on Friday, but in an e-mail to Reuters on Sunday, Laurent Sacchi, Danone's group secretary, said Mead Johnson was "absolutely not discussed" at Danone's Oct. 17 board meeting.

However he did not specifically comment on whether Danone was or could be interested in Mead Johnson.

"No decision has been made on what the priorities are in the group's external growth program at that board meeting nor in previous ones and there is no strategic review under way," Sacchi said.

Paris-based Danone has been grappling with falling earnings and some investors have questioned whether the company can thrive in its current form as it competes with larger rivals Nestle SA and Unilever Plc.

The group has said it is working on a plan to ensure long-term growth known as Danone 2020, but has repeatedly denied this included a review of assets involving major deals.

The plan, outlined to analysts at a June seminar in New York, mainly entails organizational changes to simplify and accelerate decision-making and adapt to competition, notably in Europe, plus the centralization of procurement to reduce exposure to dairy price volatility.

With regard to Mead Johnson, the sources did not say whether Danone had made any approach to the company or hired any advisors. Mead Johnson declined to comment.

Shares in the U.S. group closed up 9.8 percent at $100.23 in New York on Friday.

Many have speculated that Danone might sell an asset before buying one, repeating the pattern from 2007 when it bid 12.3 billion euros ($15.7 billion) for Dutch baby food maker Numico less than a week after announcing the 5.3 billion euro sale of its biscuit business to Kraft.

Reuters first reported in February that Danone was looking to sell its medical nutrition business, worth between 4 billion euros and 7 billion, according to analysts.

German healthcare group Fresenius, together with private equity funds PAI and Permira, are the last bidders left in a race that had included Hospira and Nestle, several other sources familiar with the matter said.

Danone on Sunday declined comment on speculation it might sell its medical nutrition business.