The BBC's Jane Warr: "It's a euphoric mood"

The Virgin tycoon and co-pilots Per Lindstrand and Steve Fossett landed in the Pacific Ocean, 10 miles off Hawaii's Oahu island, seven days after beginning their assault on one of the last great air records.

Speaking from the ICO Global control centre in Uxbridge, Project Director Mike Kendrick said: "It's a failure, but it's a glorious failure."

Branson and his co-pilots had been preparing for the landing all day after an area of low pressure had raised fears that the attempt would have to be aborted.

The landing was complicated because the capsule containing the men failed to detach itself from the eight-storey balloon and was dragged across the ocean for 15 minutes before the crew could jump to safety.

Richard Branson: "Healthy, well, happy to be alive"

Soon afterwards a tired-looking Branson said: "Thank you all so very much. We had one hell of a landing. It was very fortunate that you were there to take us through our paces.

"It was a ridiculous way to spend your Christmas Day but it was certainly exciting."

From the coastguard base in Hawaii, Fossett said: "I've made three attempts to fly around the world just in 1998.

Steve Fossett: "We really thought we were going to make it"

"It's getting pretty discouraging to come what I believe is close and still not be able to grasp the golden ring."

The project's London flight planners confirmed the splashdown at 1945 GMT on Friday and there were cheers from the control room when it was reported that the crew was safe.

Mike Kendrick: "It sounds as if Per really greased it in"

The coastguard - which had already been briefed about the hazards of the mission - had sent out a cutter and a helicopter to rescue the men.

There were no injuries among the crew, who were taken to Barbers Point Coastguard Air Station near Honolulu before being transported to a nearby hospital as a precaution.

The crew's record bid had been foiled after the balloon became caught in a low pressure trough, losing the winds that would have carried them to the west coast of America.

The crew were said to be feeling "deflated"

Speaking before the balloon splashed down, Mr Kendrick said: "We were beset with all sorts of problems from the beginning when we launched in Marrakech but they were all political.

"In the end, a weather problem is what stopped us, but that is the nature of ballooning."

Mr Kendrick said Lindstrand, who built the balloon, was the one chosen to land it.

They were well equipped for almost any eventuality, with a dinghy, a four-man raft, personal safety beacons and shark repellent stored on board the balloon.