UPDATE 1-DSG says not in talks to be bought by Metro

(recasts with comment from DSG)

LONDON, Sept 6 (Reuters) - DSG International Plc (DSGI.L: Quote, Profile, Research), Europe's second-biggest electrical goods retailer, said on Saturday it was not in talks with bigger rival Metro AG (MOEG.DE: Quote, Profile, Research) about a possible takeover by the German firm.

Earlier, the Financial Times reported DSG had made an informal approach to Metro in the Spring about being bought by the German retailer's electrical goods business Media Markt, but that Metro had rejected the idea.

"We are not in any discussions whatsoever with Metro," said a spokesman for Britain's DSG, which trades as Currys and PC World in the UK, UniEuro in Italy and Elkjop in Nordic countries.

Citing people familiar with both companies, the Financial Times said Metro was put off by the size of the potential deal.

"We never comment on speculation and rumour," the DSG spokesman said about the Financial Times report. "DSG is totally committed to its renewal and transformation plan. The management team led by John Browett is completely focused on that."

Metro, Germany's biggest retailer, declined to comment.

An industry source said an attempt to combine Europe's two biggest electrical goods retailers could meet opposition from anti-trust regulators.

"There would be some interesting conversations if it did happen," the source said, noting that DSG's and Media Markt's businesses overlapped in Italy and some Scandinavian countries.