The dispute between the Royal Opera House and the newly re-opened Sadler's Wells Theatre has been settled this week with a pay-off of more than £1 million compensation, brokered by the two organisations and the Arts Council.

Last month, the Royal Opera and Royal Ballet cancelled 25 weeks of programming at Sadler's Wells as part of a drastic rescue package. The companies were due to take up residency at Sadler's Wells during part of the two-year, £214 million refurbishment of their Covent Garden home, due to re-open at the end of 1999. The decision to effectively close for business during the whole of 1999 was announced by ROH chairman Sir Colin Southgate as a last-ditch effort to rectify years of financial mismanagement and secure the future of the house. Ironically, the cancellation of the Sadler's Wells dates threatened the future of that theatre, which has itself been closed for a two year, £48 million redevelopment.

The compensation package was confirmed by Sadler's Wells chief executive Ian Albery this week as the capital's premier dance venue presented an opening night gala which featured the world premiere of a new work by the Rambert Dance Company. Albery announced that, though gaping holes remained in the programme and the bank balance was still precarious, the ROH payment would ensure that Sadler's Wells remained open.