Also, Danone denies that it deliberately encouraged speculation about a possible bid.

In mid July, an item in a French business magazine spawned rumors about a takeover bid. As those rumors continued to spread, the French company's shares rose by more than 20%.

All along, PepsiCo had declined to comment. Once Danone's chairman revealed he had never been approach by Pepsi, the stock price slumped.

Investor advocates groups are now questioning French authorities, and at the height of the rumors, the possibility of a U.S. bid for such a prominent French company led to defensive comments from French President Jacques Chirac.