Robert Tchenguiz is in talks with Mitchells & Butlers about reducing the size of their aborted £4.5bn pub property joint venture in an effort to revive the deal. The Times

Tchenguiz is understood to be keen to seal a deal with the All Bar One and Vintage Inns operator following a sharp drop in the value of his 10% stake in J Sainsbury.

M&B is also keen to revive a deal as it is sitting on a potential loss of £140m from hedging the property joint venture. It was forced to cancel the deal in August when the credit crunch stymied plans to raise £4 billion of debt funding for the venture.

A source close to M&B said that one of the options being looked at was removing some of the pubs from the proposed joint venture with aiming to add them at a later stage once the credit markets have improved.

Shares of M&B added 20p to 630p.