With its tartan label, origins in the Ochill Hills and connotations of rugged remoteness, Highland Spring has become an iconic Scottish brand.

But the bottled water firm could soon be swallowed by US drinks giant Coca-Cola, according to reports.

Coke, which already owns the Malvern Water brand, has been trying to diversify away from its fizzy drinks brands amid increasing trends towards healthier lifestyles.

Highland Spring is the UK's second-biggest water manufacturer behind French conglomerate Danone, producer of Volvic and Evian.

Coca-Cola is keen to expand into the market, with current trends showing people in the UK are expected to drink more bottled water than Coke by the end of the decade.

Reports over the weekend, which neither company would confirm or comment on, claim Coke is preparing a bid, thought to be in the region of £500m, for Highland Spring. The Perthshire-based firm last year had a turnover of £55m.

Last summer's high temperatures brought about a huge increase in the sales of bottled water, while the British Soft Drinks Association claims there is a general move away from fizzy drinks towards water and fruit juices.

There has been speculation that Coke had been preparing a bid for Irn Bru's owners, Cumbernauld-based AG Barr, which itself paid £15m for the Strathmore mineral water brand a year ago.

Last night a spokeswoman for Highland Spring said talk about a takeover move had been around for some time but the firm was refusing to comment on it.

In the past few years the company has raised its profile, agreeing a £1m sponsorship with tennis star Andy Murray and becoming one of the corporate sponsors for Glasgow's bid to host the 2014 Commonwealth Games.

But, despite being a success story for Scotland, the company is actually owned by the Dubai-based Al-Tajir family through a company based in Liechtenstein.

Highland Spring was first registered as a natural mineral water in 1982 and was a founder member of the National Mineral Water Association.

Any deal with Highland Spring would be Coke's first major attempt to re-enter the UK water market following the disastrous UK launch of its Dasani brand in 2004.

Dasani was pulled from shop shelves after it was discovered to be contaminated with bromate, a cancer-causing chemical. The brand had already suffered after it was reported to contain nothing more than tap water.

In a similar move to expand its brands in the US, Coca-Cola last week snapped up Glaceau, a company which makes flavoured and vitamin-enhanced water, for $4.1bn (£2.1bn).