Speculation was rife that the decision to build the plant in Liverpool hung "on a signature from NI".

"We understand why people have asked that question but they have to understand that we will not answer it," said Arvato chief executive Hartmut Ostrowski.

Despite not having planning permission for the plant, which is also getting 7m of funding from the DTI's Industrial Development Unit, the firm said it was confident that it would get the green light from Liverpool City Council by the end of the year.

"We would not have picked the site if we did not think we would get permission to build," said Ostrowski (pictured left).

Construction work on the 50,000m2 facility would commence in early 2005 and would be running to full capacity in early 2008.

The group added that the plant would take on additional "local" work and that it would not result in any factory closures on the continent.

Three new KBA presses will be installed with a fourth KBA press to be transferred from one of its plants in Germany. Decisions on pre-press and bindery equipment would be made later this year.

Around 400 jobs will be created at the plant but Arvato denied speculation that it would grow to 1,000 jobs if it is a success.

Arvato also dismissed speculation that the site would produce catalogues for clients including Littlewoods, Argos and Next.

Story by Philip Chadwick