TEXTILE and ceramic design firm Peagreen has bought Winchester's Hampshire House for about £400,000.

Formerly the offices of the Hampshire Chronicle newspaper, the Grade II listed building has also been a pub and storage for a chocolate firm.

Peagreen was started 12 years ago by husband and wife team Michael and Izzy Matthews and today counts retailers Habitat and Paperchase among its clients.

Mrs Matthews said that it would take some time to move in as they were waiting for approval from Winchester City Council.

"We are talking months, as we have still got to get our planning permission," she said.

Agents Goadsby said that discussions were still under way about the future of the remainder of the site - 57 High Street.

David Rowthorn, a consultant at Goadsby, said: "There's the bones of a deal, except there are a lot of negotiations about repair work."

A previous application from the owners of Ask Pizza and Urban Leisure UK for the site has been withdrawn. Mr Rowthorn added that it was likely to be resubmitted soon with some minor changes.