LIVERPOOL Council last night extended an olive branch to supermarket giants Tesco in a bid to resolve a bitter dispute over a key regeneration scheme.

City officials have written to Tesco asking to buy the supermarket’s land in north Liverpool needed for the £150m Project Jennifer regeneration scheme involving rival Sainsbury’s.

It comes after Tesco initially wrote to the city council insisting it was not holding up the city’s planned revamp of the Great Homer Street area of Everton. It can also be revealed today that the West Everton Community Council has written to Tesco chief executive Sir Terry Leahy asking him to personally intervene and end its interest in the area.

It is the latest episode in a bitter row that has previously seen the council accuse Tesco of standing in the way of north Liverpool regeneration.

The city council’s plan includes a 110,000 sq ft Sainsbury’s supermarket, non-food retail stores, a market hall, 481 new homes, a health centre, a new library, and some industrial space.Tesco itself wants to build a 27,000 sq ft superstore and indoor and outdoor markets.

Neither party can proceed with the separate schemes without the other’s land.

Tesco had originally been in talks with developers St Modwen and brought legal action to try to proceed with its own plans in the area.

But, in December, a planning inspector ruled in favour of the city council, which had rejected Tesco’s scheme. Sainsbury’s chief executive Justin King has since been to Liverpool to sign up to Project Jennifer.

But Tesco has launched a legal challenge to the inspector’s decision, saying it was wrong in law.

In a letter to the council, seen by the Daily Post, the supermarket’s lawyers state: “Tesco does not make such challenges lightly.

“It has taken advice from its legal team and in the light of that has concluded that it cannot let such a legally flawed decision go unchallenged.

“We are aware that public statements have been made by various parties suggesting that the legal action being pursued by Tesco is preventing the progress of the regeneration scheme being proposed by the council and its partners.

“We would like to make it clear that this is not the case.”