Dairy producer Morinaga Milk Industry Co. is mulling setting up an advisory panel of outside experts with an eye toward exploring business integration with snack-maker Morinaga & Co., sources close to the matter said Tuesday.

The move came as a Singapore-based investment fund, a Morinaga Milk shareholder, demanded the company reconsider integrating their businesses after merger talks between the two Japanese companies with shared origins failed in March 2017 due to differing views on streamlining measures and management personnel.

Lone Alpha Capital Management Pte., established last summer, has a nearly 4 percent stake in Morinaga Milk and is likely to have also acquired a stake in the snack company, the sources said.