NEW BAR: The Funky Monkey is being sold and is set to become a new establishment for Wetherspoons.. Picture: Mike Southon No 0906-168_06
The firm, which owns more than 730 pubs nationwide, is currently exchanging contracts on the former Funky Munky's site on the Strand, although no date has yet been set for completion.
The building has been home to pubs and nightclubs for more than 30 years including Chequers, Zenaxis and the Litten Tree.
Eddie Gershon, spokesman for Wetherspoons, said: "The Panniers has been very successful for us and we have always thought the town could support two Wetherspoons establishments. It is great to have found the right site.
"At the moment the company is purchasing a lot of empty former pubs, carrying out refurbishments and opening them pretty quickly.
"We do not have a date set for opening but it will be sooner rather than later."
However, with pubs suffering heavily in the current economic climate, could the introduction of a second budget bar in the town have consequences for other local businesses?
Jean Knill, secretary of the North Devon branch of the Federation of Licensed Victuallers Association (FLVA), said: "Trade is bad enough for pubs at the moment but when you've got a big business like this selling drinks so cheaply it gives them an unfair advantage. Smaller pubs can't possibly get a discount as big as them.
"It's not right that a big company of this sort has two establishments in the same town — but what can we do?
"It is up to the pubs of Barnstaple to unite against this."
Ryan Churchward owns Claytons bar and restaurant in Cross Street . He has also recently opened his second bar, the White Horse on Boutport Street.
Ryan believes that a second Wetherspoon's in the town would be "the worst thing that could possibly happen in a recession".
He said: "I've been following their progress carefully over the past two years and I believe the bar in question will end up being a Lloyds establishment — meaning it will have a DJ booth, music, dance floor and screens for sports matches.
"While they won't compete with Claytons on food, they will certainly clean up on the weekend drinking trade. I think all competition is good but if this goes ahead it could have massive implications for local pubs."
Mike Deakin, owner of the Venue nightclub on the Strand, said: "I think this is fantastic news.
"Wetherspoons are a professional operation who are great at what they do and I for one am happy that they are investing in the town.
"There have been many failed attempts to revive the Strand but this could be the catalyst."
Wetherspoons spokesman Eddie said that, although the company was unsure if the new bar would become a Lloyd's pub, there is a possibility it could be.
He added: "It would be naive of us to say that (the new pub) won't have any effect on the town.
"We are investing in the town and providing new jobs. Ultimately it is about choice — we are in competition with other pubs in the area.
"Price, food, a wide range of real ales and wheelchair access are all relevant to our customers. People will have to decide where it is they want to drink."