Pub chain Bar Med has ditched plans for a late-opening superpub in Worthing.

But neighbours are keeping the champagne on ice because the owner of the former Landmark furniture store in Chapel Road is believed to be looking for another operator to take on the site.

The rival Barracuda group has already put in a bid for a drinks licence at the venue.

Worthing Borough Council had set aside £40,000 to fight midnight opening plans by Bar Med approved by magistrates.

Tory borough councillor George Stephens said: "This is absolutely fantastic. After all the stresses and strains of the last few months, residents should now sleep soundly in their beds."

Judith Badcock, 69, who is housebound and lives in Wenban Road, Worthing, welcomed the news.

She said: "We have a residents' association which has been fighting the plans. We felt threatened by another pub opening in the town centre because we have too many already.

"We did not want more graffiti and violence."

The council feared opening until midnight every night of the week would open the floodgates for other applications, turning Worthing into the South Coast's answer to Ibiza.

Julian Lavey, director of licensing for SFI, which owns the Bar Med chain, said the landlord had pulled out of the deal.

He said: "I am disappointed the landlord was not prepared to wait any longer for the site to be occupied. As far as I am aware, he is looking for someone else to take over the site instead.

"But I can understand his decision. There was the delay created by the council's decision to appeal."

He said the company tried to negotiate with the council by suggesting a Litten Tree pub, also an SFI-owned chain, instead of a Bar Med. Mr Lavey said: "We tried to keep everyone happy but the main stumbling block was the council's refusal for midnight closing.

"This was something we were not prepared to negotiate. If you have music and dancing for over-25s then you need to close later because that clientele go out later in the evening."

Landlord Robert Walker, of Lionbell, which owns the Landmark store, declined to comment.

Meanwhile, planning permission has been given for a pool and snooker hall on the first and second floors of the building in Chapel Road.

Councillors rejected an application for 24-hour opening but agreed midnight closing.