Pubs giant Punch Taverns today poured cold water on speculation it was in talks over a £5 billion merger deal with Mitchells & Butlers.
Punch Taverns was said to have approached leading shareholders of Mitchells & Butlers about a deal to create a business with 11,000 pubs.
But following a weekend of press speculation, Punch told the stock market today that no such talks were taking place.
It said: "Punch Taverns notes the current speculation regarding Punch and Mitchells & Butlers. Punch confirms that it is not in discussions with Mitchells & Butlers or any Mitchells & Butlers shareholder regarding any offer or merger.
Mitchells & Butlers operates chains of themed pubs and restaurants such as Flares Bars, O'Neill's Irish pubs and Browns bar and restaurants. It has a presence in most of the UK's major population centres.
The group's property has been the subject of some speculation recently.
Ealier this month it emerged that racing tycoons John Magnier and JP McManus had increased their shareholding in M&B, to 4 per cent.
There is speculation that the move is a property play. The company's share price is cheap relative to the value of its properties.