Quanta, the world's largest contract manufacturer of notebook PCs, has denied plans to merge with or be acquired by the biggest contract electronics maker.

Quanta Computer, which makes laptops for companies such as Apple, Dell and HP, denied local news reports in Taiwan that it is in talks with Hon Hai Precision Industry regarding an acquisition.

Hon Hai, which makes a range of electronics devices, from iPods to PlayStation 3 consoles, has been rumoured to be on the lookout to acquire a notebook PC maker, one of the few contract electronics businesses in which it is not a major player.

"The news report is based on market speculation. Quanta has no plans to merge with or be acquired by Hon Hai," Quanta said in a statement to the Taiwan Stock Exchange late on Tuesday.