Speaking as the €3bn-turnover (£2.7bn) company celebrated the 75th anniversary of first establishing its business in Japan, chairman Rokus van Iperen said: "We are facing economies of scale issues and are looking at all alternatives to resolve this, including strategic alliances, joint developments and other forms of co-operation including full mergers - nothing is excluded."

He declined to be specific about what an ideal size would be, saying only that "we would prefer to be bigger."

There has been speculation that Konica Minolta, an existing Océ partner, would be the most likely candidate to make a takeover bid. However, van Iperen said that was "not automatically" the case. "A conglomerate could decide to split out its printing business, as Siemens did in 1996, then the whole game could be different."

Océ is also restructuring its operations to ensure that its position as an independent business remains secure. It announced a further 800 jobs across the group will go, yielding €64m in cost savings.

The move means 8% of its worldwide workforce will be cut during 2008-2009. New banking facilities have also been agreed.

"Safeguarding the position of Océ as a standalone business is our first priority," van Iperen stated. "When I look at the industry average decline in revenues, Océ is relatively stable in comparison."

The company has stress tested its business model against a variety of economic circumstances to ensure it can survive a worst case scenario.

It is also asking its operating companies to look at ways to further reduce labour costs, while avoiding lay-offs. In Japan, there has been a company-wide wage reduction. "This is less destructive than restructuring," van Iperen said.

Océ shares were down 8.5% at €4.57 in trading today. The 52-week low is €1.82.

See also:
Océ adapts ColorWave 600 for display sector
Océ secures ISO 14001 for UK and Ireland sites