When Asus held a shareholder meeting on Friday, Jonney Shih, the company's chairman, talked about the possibility of a merger with HTC.

While Asus has somehow clarified that investment plans with the smartphone maker are yet to be confirmed, the talk prompted HTC to deny merger claims.

According to Taiwan-based HTC, talks about the possible merger with Asus are unlikely to occur. The company strongly denied the rumors and added that such acquisition would not be considered.

"We strongly deny the news," said HTC in a statement. "We didn't contact Asustek and will not consider the acquisition. As an international brand, HTC will continue to design world-class innovative smart devices through its pursuit of brilliance brand promise."

HTC has a track record of selling one in 10 smartphones on a global scale. It has produced some of the market's best Android handsets, which include 2013's HTC One and last year's HTC One M8.

The current flagship, the M9 model, is designed with almost the same features found on its older siblings. However, the new flagship seemed to be struggling to achieve its market share, a situation deemed by industry watchers as something that is not about to change just yet.

HTC's lineup of devices has been having a hard time keeping up with other popular makers such as Samsung, Xiaomi, Huawei and Lenovo.

However, the company has shown resilience by taking a number of major steps recently. In March, it placed Cher Wang as the new chairperson while Peter Chou, her predecessor, assumed a post in the company's product development side. New product concepts are also in the pipeline. These include a standalone camera and a virtual reality headset.

Asus, for its part, is an established name in the laptop industry and has been slowly carving its name in the world of smartphones, all thanks to the introduction of its Zenfone series, which caters to customers who are in the market for ultra low-priced devices.

A recent report released by HSBC revealed that Asus is seeing a growth in the shipment of smartphones by 89 percent before the year ends. This could have prompted the company to continue building, even after a failed attempt, a strong smartphone presence in the West. The move to acquire HTC may just allow the company to achieve such goal.