A top-class catering firm has pulled out of its contract to supply food to visitors at Brighton and Hove’s cultural hotspots.

Brighton and Hove City Council has confirmed that Peyton & Byrne will cease to deliver catering and hospitality functions for Brighton Dome and Brighton Festival and Royal Pavilion and Museums over the next few months.

A spokeswoman for the local authority said that although Peyton & Byrne entered the contract with enthusiasm and considerable investment, they now feel that the project “does not fit” with their core activities in London.

The council said that it is now anticipated that the Brighton Dome and Brighton Festival bars will return to in-house management while joint tenders for a new firm to run event catering and the daytime cafes will be sought.

Unions are being consulted on the future of existing Peyton & Byrne staff while customers are being reassured that existing event catering commitments will be honoured and café facilities will remain open for business until the tendering process for cafes is complete..

The company, which is run by BBC Great British Menu judge Oliver Peyton, signed a five year contract to cater for Brighton’s culture vultures in 2012.

At the time, the contract was billed as a homecoming for the family firm which opened hip-hop club The Can in Brighton in 1979.

The company also has contracts for catering at Kew Gardens, the British Library, the Royal Academy and the National Gallery.

In a combined statement, Janita Bagshawe, head of Royal Pavilion, Arts and Museums and Andrew Comben, chief executive of Brighton Dome & Brighton Festival said: “We are disappointed that Peyton & Bryrne will be leaving at this stage especially as they have invested considerably locally in existing and new outlets over the past 16 months.

“We are pleased to confirm, however, that Brighton Dome and Brighton Festival and the Royal Pavilion will continue working in partnership on a joint tender for event catering and daytime cafes.

“We look forward to welcoming applications from bidders who appreciate the uniqueness of Brighton and Hove and can cater for what our visitors and audiences really want, helping us to make the Royal Pavilion Estate a world-class destination for residents and visitors.”