Danone‘s CEO has reportedly said that the French group is not seeking to sell its bottled water business, but it is negotiating a new distribution set-up in Japan.

Franck Riboud was quoted in the Financial Times newsaper today (22 November) as saying that Evian water is part of “Danone’s DNA”. Bottled water will remain a part of the group’s business, he said.

His comments will comes as little surprise to many analysts, who have been sceptical of recent reports that Danone has been seeking to offload the water division to one of Japan’s major drinks firms.

“I don’t believe it will happen,” one Paris-based analyst told just-drinks at the time. “Mineral water sits very nicely within Danone’s strategic emphasis that its products are beneficial to good health and well being,” he added.

Instead of a sale, Riboud said that Danone is seeking to sign a fresh distribution agreement in Japan, where bottled water sales have suffered alongside sluggish consumption in the wider drinks market.

Kirin Holdings may have a headstart due to its existing existing distribution deal for Danone’s Volvic water in Japan. Equally, however, the French firm may decide on a new beginning. Kirin recalled half a million bottles of Volvic in 2008 after consumers complained of a bad odour upon opening the water.