PUB supremo Margo Grimshaw's plans to demolish two pubs and replace them with flats may be thwarted by the brewery which owns them.

A spokesman for Thwaites today said that they wanted the Sun and Bar Code pubs in Astley Gate, Blackburn, to carry on trading.

But Margo, who made her millions from Blackburn's nightclub scene, still intends to try to buy the pubs, saying market forces will decide what happens.

Margo has secured planning permission to knock down three pubs in Astley gate and replace them with 23 apartments above new shop units.

But she currently only owns one of the pubs -- The Swan.

Under the plans approved, The Swan will be demolished first and nine apartments built, with work starting in October.

The rest of the flats would be built on the site of the neighbouring Sun and Bar Code venues once Margo owned them.

Margo told council planners she expected work to begin between January and July 2007.

But a spokesman for Blackburn-based Thwaites said today: "We intend for both businesses to continue trading.

"We are aware of the planning permission, but it is possible to gain planning permission without actually owning a site."

Phillip Price, whose wife Bernadette has run The Sun for the past five years, said: "We've been promised that the building isn't going to be sold.

"We think it is very unfair of Margo to talk about knocking down a building she doesn't own, because it has had an impact on the business.

"We've worked hard to build up the business and Thwaites have no plans to sell the building.

"We're one of the busiest pubs in Blackburn."

Margo, who lives at Toad Hall in Preston New Road, said: "I am a very forward thinking person and I am looking to the future. Market forces will decide what happens in Blackburn town centre."

When the scheme was approved by councillors, she said she was confident she would be able to buy the other two pubs.

There will be no such problems with other flats project she has had approved by councillors.

The Castle, C'est La Vie, Never Never Land and Mr G's nightclub, properties which she owns in the Market Street Lane area, will all be demolished.

They will be replaced by 62 apartments, built in several blocks, each between three and six storeys tall.

Underground parking would also be created, with the ground floor used for shops or restaurants.