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

The capsule containing the men failed to detach itself automatically from the eight-storey balloon as it landed 10 miles off Hawaii's Oahu island at 1945 GMT.

It was dragged for 15 minutes across the ocean and had begun to fill with water before the crew could jump to safety. They were rescued by US coastguards 10 minutes later.

Speaking from Hawaii, Branson said: "We just wanted to get out of it, we just wanted to get home, we were just holding on for dear life.

"It was sad. It was the most beautiful balloon, the most beautiful capsule, it was working like perfection.

"We had gone better then anyone else that had tried it before. We were three days from home, so to abandon it to the seas just because of this weather block was sad."

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

The Virgin tycoon and co-pilots Per Lindstrand and Steve Fossett were forced to abort the attempt seven days after beginning their assault on one of the last great aviation records.

The flight hit a trough of low pressure on Thursday night, causing it to lose the winds that would have carried it to the west coast of the US.

By sunrise the crew knew the attempt was going to fail and spent most of Christmas Day preparing for splashdown by steering the balloon towards Hawaii.

Lindstrand, who built the balloon, was chosen to land it.

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

Speaking from the ICO Global control centre in Uxbridge, Project Director Mike Kendrick described the record attempt as "a failure, but it's a glorious failure".

There were tense moments at the control centre after the balloon landed, because it was initially unclear if all the crew has been picked up.

A short time later the news that Branson and his co-pilots were safe was greeted with cheers from the project's London staff, who then sang "We Wish You A Merry Christmas" to the balloon's crew over a satellite telephone.

The crew were said to be feeling "deflated"

At Barbers Point Coastguard Air Station near Honolulu, a disconsolate Fossett - holder of the record for the longest solo flight in a balloon - was unable to hide his frustration.

"I've made three attempts to fly around the world just in 1998," he said.

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

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

Branson said the crew were looking forward to getting back to their families, adding: "It was a ridiculous way to spend your Christmas Day but it was certainly exciting."

Speaking just before the flight 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."