News of the Bluebird hydroplane returning and being displayed permanently in the Lake District village of Coniston has been welcomed by a business owner.

The hydroplane, piloted by Donald Campbell, set multiple world water speed records prior to its crash in Coniston Water in January 1967.

The Bluebird was submerged on the lake bed for 34 years until being discovered and recovered by Bill Smith, a North Shields engineer and diver, in 2001.

Subsequently, five years later, the vessel was gifted to the John Ruskin Museum at Coniston by Donald Campbell's family.

The museum, which already built an £800,000 wing for Bluebird, had been delayed in its efforts to house it due to an ongoing dispute.

A statement released by the museum said: "Bluebird K7 will return to Coniston in the coming weeks to be conserved and displayed in her forever home in the Bluebird Wing of The Ruskin Museum."

Phil Johnston, founder and owner of the Coppermines Lakes Cottages holiday company in Coniston, said: "This is absolutely fantastic news for all the team behind the campaign to bring Bluebird home – but also for Coniston village as a whole.

"This is a great moment for Coniston and we cannot wait to see Bluebird back in the village.

"Many people in Coniston, including us, have helped raise money to fund legal action to try and resolve the situation and get Bluebird back.

"We feel she has been saved for the people of Coniston and for the nation."

The return of Bluebird is expected to spark an influx of tourists to Coniston from across the country and even globally.

Mr Johnston said: "The story of Bluebird and Donald Campbell has always generated such a lot of interest and has struck a chord with so many people.

"I have no doubt many people will want to head to Coniston in the coming weeks."

The Ruskin Museum said: "We will issue further details of this exciting development when we have established a timetable for moving the boat to Coniston and installing her for display."

The museum offers a year’s membership with free admission to people who add Gift Aid to their initial admission charge.

The Coppermines Lakes Cottages company has more than 90 holiday cottages in the Coniston and wider Lake District area.