A prominent fruit and veg company has quashed fears it is going bust.

C H Mears, which has a shop and a stall at the Open Market, off London Road, Brighton, and a wholesale business based in Hollingbury, has been served with a winding-up petition.

A meeting with creditors is being held in London today.

It follows two weeks after the sudden closure of the stall, which prompted speculation of deeper problems for the business.

But yesterday owner Pat Mears insisted his company's issues had been resolved.

He said: "We had some cashflow problems last year but those have been dealt with and we will finalise that tomorrow. It is business as usual."

Mr Mears said the stall near The Level entrance to the Open Market would be reopened within days following a refit forced by complaints from another stall-holder.

He admitted the business had been hit by the recession but insisted it would not fold.

The winding-up petition was served by Dutch Direct, a supplier based in Maidstone, Kent, which was trying to claw back money it was owed.

Tom Chiverton, from Dutch Direct, confirmed yesterday that C H Mears had settled its arrears which had dated back more than a year.

He said: "We're just waiting for them to pay back some legal costs and interest and then we'll withdraw the petition."

Mr Mears said the closed stall would reopen as a self-service facility after another stall-holder complained about barrows being left outside and attracting seagulls.

He said health and safety officers had been called in but had found no problems.

C H Mears has been at the Open Market since 1948. The family business first appeared there in the 1920s.

The company has grown to be one of the city's biggest produce suppliers, providing fruit and veg to many of Brighton and Hove's schools and businesses.

Mr Mears and his sister Mary Mears, who worked for the company before becoming the leader of Brighton and Hove City Council in 2008, have been leading a bid to regenerate the Open Market.

Stuart Gover, who runs Grandad's Bike Shop, at the Open Market, said: "Everyone will be pleased they are staying, they bring a lot of customers to the area.

"It was a terrible scene when they closed the stall. Mary had tears in her eyes and I'm not surprised - her mother had kept that place open through the war."