Madisons Coffee, the former coffee bar operator now concentrating on its Richoux restaurant chain, is in talks about buying restaurant chain Bel and the Dragon.
In a short statement to the London Stock Exchange, Madisons confirmed it was holding discussions, which might or might not lead to the acquisition of the business.
Bel and the Dragon consists of four restaurants in Cookham, Windsor, Godalming and Reading.
It is owned by restaurateurs Michael and Andrea Mortimer who, it is understood, are hoping to have agreed a deal one way or another by the end of the month.
Speculation has suggested that Madisons, which is soon to change its name to Gourmet Holdings, might pay about £6m for the restaurants.
Earlier this month Madisons said it was issuing one million new shares to fund acquisitions.
by Nic Paton
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