As Paul Waugh reveals, Labour are denying it all - but the story still makes a lot of sense. After all, Sugar is high-profile; popular with the public; and, despite his burgeoning friendship with Gordon Brown, sufficiently independent to remain unsullied by this Government. And, to top it all off, he's not Ken Livingstone.
To my mind, he could could be a formidable opponent for Boris, and Tory grassroots seem to agree - respondents to a ConservativeHome survey last week put him as "Boris's most dangerous opponent in 2012". Watch this space.