CASH-strapped nightclub chain Heaven and Hell has been placed into insolvency after losing late-night custom to pubs.

But Blackburn-born club boss Peter Clarke was today hoping to secure the future of his club in the town after agreeing a £2.5million-plus deal with brewers Scottish and Newcastle his company's biggest creditors.

But other creditors will not be so lucky, with receivers admitting they stand to receive nothing.

Mr Clarke said that new licensing laws introduced in November allowing pubs to stay open longer had taken their toll on trade, meaning he was unable to maintain the brand in its current state.

Mr Clarke took over the Lord Square nightclub in August 2004 and re-launched it following a £1million refurbishment.

The deal with Scottish and Newcastle has allowed him to buy back three of the former Heaven and Hell sites in Blackburn, Barnsley and Hull from receivers under the new company name Shelrick Ltd.

Mr Clarke, 46, said: "This has been a very difficult time for me, both personally and professionally, as I have so much emotional attachment to the Heaven and Hell brand.

"However, I have to look to the future. I have a very talented and capable team who, over the past 12 months, have demonstrated commitment and loyalty to both myself and the company and, with their proven skills and understanding of the industry, Shelrick Ltd has an exciting future, particularly in my home town.

"Although trading has been difficult over the last few years, the company has seen a breakthrough with its latest brand Terminal 1', which Shelrick now intend to roll out throughout the acquired sites, again with the support of the brewery.

"All staff currently employed within Blackburn, Barnsley and Hull will be transferring to the new business. Shelrick Ltd will continue to trade from the current head office in Blackpool."

Mr Clarke managed to sell off his nightclubs in Huddersfield, Leeds and Blackpool before the insolvency was forced.

The Heaven and Hell club in Stockport remains within Mr Clarke's Entrepreneurial Leisure portfolio, although it has been taken over by the site's landlord and is no longer open.

In 2004 Entrepreneurial Leisure had a staff of 300 and an estimated turnover of £10m.

Andrew Dick and Steven Williams, of Begbies Traynor, Preston have been appointed receivers to deal with the group's affairs.

Mr Williams said: "Although a deal has been done to satisfy the major creditor, other creditors will not have their outstanding balances settled."