I have got the best possible deal

Bernard Rayner

But in a surprise move on Wednesday morning, the judge who was due to hear the case, Mr Justice Hooper, was told Mr Rayner was now prepared to cease trading with immediate effect.

Outside court Mr Rayner denied that he had sold out, saying he was "happy" about the settlement.

The amount has not been disclosed, but Mr Rayner said: "I have got the best possible deal."

The London Mayor, Ken Livingstone, said later in a statement: "I am delighted we have managed to reach agreement so quickly.

"The out-of-court settlement now means I can continue with my plans to transform Trafalgar Square into a cultural space for Londoners and visitors to enjoy."

Solicitors for The Greater London Authority (GLA) said an agreed sum would be paid to Mr Rayner "to recognise the fact that he will be unable to trade in the square in the future".

Ken Livingstone wants to clean up the square

Part of the sum representing Mr Rayner's costs would be donated to an animal welfare organisation.

The GLA is to organise a programme for the phased withdrawal of feeding the pigeons until 30 April.

After the settlement was announced, Mr Rayner described the withdrawal scheme as "the best possible plan".

The GLA stripped Mr Rayner of his licence in the autumn, but then granted a temporary reprieve which ran out in mid-January.

Mr Rayner then won a court ruling allowing him to continue trading until Wednesday.

'Health hazard'

Mr Livingstone recently described pigeons as "rats with wings", and a health hazard.

The GLA plans to clean up the mess in Trafalgar Square caused by pigeon droppings, and pedestrianise the upper part of the square to make way for more cultural pursuits for visitors.

Pigeon campaigners expressed their dismay over Wednesday's settlement, accusing Mr Livingstone of "bully boy tactics".

Andrew Butler, the UK representative of People for the Ethical Treatment of Animals Europe (PETA), said: "Basically this spells disaster for London's pigeon population.

"There is a strong likelihood that 25% of the 6,000 Trafalgar Square flock will starve to death."