It is the kind of combination that perhaps only the inventor of egg-and-bacon ice-cream could have thought of. One is a world-famous chef, the culinary wizard behind The Fat Duck, the Michelin-starred restaurant in Bray, Berkshire. The other serves breakfast on A roads.

Yet, courtesy of Channel 4, Heston Blumenthal really is joining forces with Little Chef. Specifically, the two are combining at a Little Chef at Popham Services on the A303 near Winchester, cooking up a storm on Big Chef takes on Little Chef. And don't be fooled into thinking that the Hampshire-based experiment is a risk only for its celebrity ingredient.

“My head said ‘No' and that we could end up being criticised,” Ian Pegler, the chief executive of Little Chef, said, “but my heart said ‘Go for it' as a chance to work with the world's best chef might never come up again.”

Mr Pegler probably should not have worried. Reviewers have heartily welcomed Blumenthal's reworking of the Little Chef's menu and the refurbishment of the interior by Ab Rogers, son of the architect Lord Rogers of Riverside. More importantly, Mr Pegler said, everyday customers have warmed to new ideas such as Hereford steak meat pie with Abbot Ale, alongside spruced-up old favourites, such as the Olympic breakfast.

The publicity will, Mr Pegler hopes, help to raise awareness of the changes happening in the restaurant chain, which he is hoping to expand by 15 per cent to 200 restaurants over the next two years - this after the company was bought by RCapital, its owner, in 2007 for £9 million. The former Marks & Spencer and Dixons executive returned to Little Chef in April after successfully leading the business in the early 1990s under Forte's ownership.

That said, when the PR wave subsides, will Blumenthal's ideas really make it on to the spring menu to be introduced in May? Mr Pegler said that the three-month trial at Popham will end in February and the experiment was being “evaluated in a positive way ... If it's successful, why wouldn't I roll it out? Heston does food that is diametrically the opposite of ours. He has got to be able to bring some sparkle and energy to our menu.”

Mr Pegler has already shown that he is prepared to make some dramatic changes beyond Popham. Since April, he has brought in new senior management, revamped and simplified the menu to include lighter meals, such as pasta, and cut costs by retraining staff so that they can work in both the kitchen and the restaurant. He has also refreshed the look of 50 restaurants and closed ten unprofitable outlets. After a revamp of the menu was introduced last June, the average spend per customer rose by 15 per cent. Mr Pegler added that re-engaging the staff and making managers more accountable had also brought benefits.

The chain's like-for-like sales rose by 2 per cent last year and are up 9 per cent this month, continuing a strong trend since last summer. The group also ended the year in profit, for the first time since at least 2006. Another positive step in the past fortnight has been renegotiation of punitive leases on 40 restaurants out of 65 that were involved in a 2006 sale-and-leaseback deal with Arazim, an Israeli property company, that was arranged by the People's Restaurant Group, Little Chef's former owner.

Little Chef, which opened its first outlet in Reading in 1958, racked up “significant losses” under the ownership of Simon Heath and Lawrence Wosskow's People's Restaurant Group, which paid Permira, the private equity group, £52 million for the business in 2005.

Mr Pegler said that Little Chef was now “positively funded” by R Capital and not weighed down by debt, and thus was ready to expand again. Last year two new restaurants, one in Shiptonthorpe, near York, and one near Warwick opened, the first new Little Chefs in more than a decade. Mr Pegler has about 14 restaurants listed for opening in 2009, mainly outlets that closed during the administration.

Mr Pegler admitted that his plans may be affected by the “many uncertainties” of the economic downturn. He said: “I don't have a crystal ball to see what's going to happen, but I do know that when I was managing Happy Eater and Little Chef in the last downturn, in the 1990s, we were the only company within Forte making progress. We used a lot of PR to get ourselves there, but we also believed that people traded down.”

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