Pubs giant Punch Taverns today poured cold water on speculation it was in talks over a £5bn merger deal with the owner of All Bar One.

Punch, which owns 92 pubs in Oxfordshire, was said to have approached leading shareholders of Mitchells & Butlers about a deal to create a business with 11,000 pubs.

But bosses told the stock market today that no such talks were taking place.

A company statement 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."