Danone, already struggling with falling yoghurt sales as consumers shift to vegan alternatives, is getting hit by a decline in its bottled-water business.

French foods group Danone is to sell a €1.5bn stake in Japanese company Yakult in its latest initiative to boost shareholder returns.

Shares in French food group Danone rose after the New York Post newspaper said in a report over the weekend that Danone could be a takeover target.