Dairy Crest shares soared at the start of the week (Dec 19) after rumours of a possible £800m takeover by French dairy giant Lactalis.

The firm’s stock rose almost a pound to 572p on Monday morning after details of the supposed bid, worth about 630p a share, were published in The Guardian newspaper.

But the share price slid back when Dairy Crest issued a statement denying any move was in the offing. City analysts said a future bid could be a possibility.

“The story does contain a lot of detail,” said one. “But on balance I’d say the odds were slightly against it. Why did Lactalis bother buying McLelland if its real target was DC?”

The competition authorities would also certainly take an interest in a deal that could give one company over 60% of the UK cheese market.

McLelland produces about 45,000t of cheese, including the Seriously Strong Cheddar brand, while Dairy Crest makes close to 100,000t.

Lactalis also imports a number of brands like President Brie and Camembert.