Denmark's Arla Foods  in talks with a number of other large European dairy manufacturers with a view to a possible merger, the company said today [Friday].

"We are in a dialogue with several other companies," Arla spokeswoman Astrid Gade Nielsen told AP, adding that the company had met with Netherlands-based Campina and Friesland and northern German dairy group Nordmilch. Gade Nielsen did not specify whether talks were likely to lead to a full-blown merger or a joint venture.

The Scandinavian cooperative held talks with Campina last year about a possible merger, but no deal was reached.

Arla Foods was born in 2000 out of the merger of Scandinavia's two largest dairy product cooperatives, MD Foods of Denmark and Sweden's Arla. It is owned by 13,000 dairy farmers in the two countries and has headquarters in Aarhus, northwest of Copenhagen.