On Wednesday, Mr Adigun and Arambe Productions reached an out-of-court settlement with the Abbey, novelist Roddy Doyle, and director Jimmy Fay over the production of a new version of The Playboy of the Western World.

The financial terms of the settlement were not disclosed in the High Court.

However, the Abbey confirmed that the settlement with Mr Adigun and Arambe Productions totals €200,000, excluding its own legal costs.

A national theatre spokeswoman said: “We made this out of court financial settlement in order to avoid a lengthy High Court hearing, the cost of which would have been even more substantial.”

She added: “The Abbey Theatre has been involved in this dispute since 2008. We made adequate provision for this settlement in the financial accounts over those years and this settlement will therefore have no impact on our future plans.”

The latest accounts for the Abbey Theatre show it recorded a loss of €340,196 in 2011. However, in an interview last November, the theatre’s finance director, Declan Cantwell, said the Abbey had reserves of €1.45m and its overall financial health was “good”.

The board of the Abbey held an emergency meeting on Tuesday to approve the financial settlement with Mr Adigun.

Mr Adigun agreed to the out-of-court settlement following a statement which was read out at the High Court on Wednesday.

The case arose out of a collaboration between Mr Adigun and Roddy Doyle over the production, first staged at the Abbey in 2007.

The chief character, Christy Mahon, was portrayed as a Nigerian asylum seeker.

The statement said the defendants acknowledged there were royalty payments due to Mr Adigun’s theatre company, Arambe Productions, from both the first and second production runs

They also acknowledged there were alterations to the script for the second production run of the play “which were not authorised by Mr Adigun”.

In recognition of this, the Abbey had agreed to make certain payments to Arambe and Mr Adigun. It was also stated that Doyle had “decided to transfer and assign all of his rights of whatever nature” in the co-authored version of the play to Mr Adigun.

Mr Adigun, of Moorefield Cottages, Roebuck Rd, Clonskeagh, Dublin, had claimed 120 changes had been made to the co-written version, which was produced at the Dublin Theatre Festival in 2007.

Mr Adigun and Arambe claimed the Abbey, in conjunction with Doyle, had remounted “a distorted version” in 2008/9.

Mr Adigun founded Arambe Productions in 2003 and contacted the Abbey to inquire about staging the play there. He said he approached Doyle to co-write the play so as to make it an intercultural collaboration and also received a €10,000 grant from the Arts Council for Arambe.