Community leaders fear for the town after Tesco pulled the plug on a £1million development in Cinderford.

After years of feuding between Tesco and the Co-op, Tesco withdrew its plans for a superstore at Dockham Road on Monday as the town's rugby club announced a 10-year sponsorship deal with the Co-op.

Announcing the decade long sponsorship deal, rugby club chairman Rob Worgan said: "This means there are no longer plans to sell the stadium, we will be staying put and all the uncertainty of the past 12 years will be over."

The Co-op had put in its own plans for a Cinderford revival but these have also been scrapped.

Now, community leaders say they fear for the regeneration of the town.

Mayor of Cinderford, Councillor Max Coborn, said: "I am very disappointed from both ways really.

"Even if Tesco had not gone through with the plans we thought the Co-op would, but now nothing is being done. It is such a shame.

"I think the people of Cinderford will suffer.

"We wanted development and I would have liked to see a bit of competition in the town but now people will only have the Co-op.

"People don't shop in Cinderford – they go elsewhere and this will keep happening.

"It is a shame, I just hope the regeneration plans for the Northern Quarter aren't affected by this."

The Homes and Communities Agency has pledged £14.75million to Cinderford regeneration which is earmarked to be spent on building a new link road to the town, a new college, more homes and jobs.

Don Burgess, chairman of Forest of Dean Federation of Small Businesses and founder of Freeminer Brewery at the Whimsey Industrial Estate in Steam Mills, said: "I think the emotive way it has been handled was detrimental to the plans, people wanted a rugby club but they also want retail support.

"I think some people will be upset but I also think a few small businesses will breathe a sigh of relief.

"What we do need, however, is a way forward for the Forest and Cinderford to prosper and a way of long-term sustainability for the businesses in the area."

Tesco has said it will now look at other sites in the town for the development after 12 years of searching.

Readers have been logging onto our website thisisgloucestershire.co.uk to have their say.

Sally-Anne, from Gloucester, said: "A Tesco store would have brought jobs to the area.

Whether that would have been on the check out, working in the bakery or on the deli, it would have been a job. For some it would mean not having to travel too far by car or bus to get to work or shop."

Douglas, from Dymock, wrote: "Tesco would have kept the prices down and, in my opinion, helped the town survive.

"There are a lot of people that travel to the larger towns that have a choice of supermarkets and while they are there they also shop in the town.

"I hope Tesco will not punish the town by keeping away but find a suitable site soon."