NORTH-East company Piranha hopes to add £2m to its £4m annual turnover after winning the licence to produce merchandise for Crazy Frog - which is due to hit the top of the charts this weekend.

Newcastle-based Piranha Studios has met the founder of the latest cult craze known as "The Annoying Thing" and won exclusive rights to produce the merchandise for Crazy Frog, as it has become known.

Crazy Frog became popular as a mobile phone ringtone and has now been transformed into a chart-topping pop song.

Piranha, which employs 40 people in Newcastle, is already taking orders for the first merchandise, which will include keyrings and stationery for the back-to-school market, and will be out in the shops in July.

The merchanise is designed in Newcastle and manufactured in China.

Founder, and sales and marketing director at Piranha, Sue Kell, said: "We were skiing in France at Christmas and saw The Annoying Thing ringtone advert on Sky TV and we thought - that is going to be huge. So as soon as we got home we contacted the creator, Erik Wernquist, and asked him if we could do a deal with him.

"We think this will be big in Europe as well as the UK, and possibly also in America.

"We are expecting the Frog to add another £2m to turnover next year."

By late summer Piranha hopes to have manufactured figurines, lunchboxes and even musical mugs for Crazy Frog fans.

Ms Kell said: "It's surprising how long these crazes last. We're expecting this one to last quite a while."

Anyone wanting to pre-order the merchandise can visit www.theannoying thingstuff.com