The deal, which is reported to have cost the company’s debt and equity investors almost £700m, was described by the Financial Times as “one of the worst failures of a European leveraged buyout in recent years”.

A group of Polestar’s senior debt holders including JPMorgan, Deutsche Bank and Royal Bank of Scotland, seized control of the heavily-indebted company after it defaulted on a scheduled repayment earlier this year.

The subsequent debt-for-equity swap, scheduled to complete yesterday (12 December), has led to the group’s total outstanding debt being cut from £814m to £257m and caused previous owner Investcorp to lose its entire equity stake in Polestar.

Some observers have speculated that the company could soon be up for sale again.

Nicholas Mockett of Europa Partners said: "The people who are now the shareholders were the debt providers and what their appetite is for hanging onto equity in the business is difficult to gauge.

"In the short term, there will probably be a bit of rationalisation going on – the odd peripheral business discontinued – then in the medium-term they would be looking to realise the value of the shares they’re left holding."

Charles Jarrold, managing director of Southernprint added: "It would be surprising to see a group of banks really wanting to take a long-term interest in the UK web-offset market at the moment."

However, one city source suggested that the banks "can take a longer-term view than private equity companies who typically look for a higher rate of return".

In a statement released last Friday, Polestar chief executive Barry Hibbert said: "The completion of the restructuring has greatly strengthened Polestar. The recapitalisation provides the business with a stable platform which will allow it to focus on the opportunities in the market place."

Neither Polestar nor Investcorp could be reached for further comment.

Another city source agreed: "It will make Polestar an even stronger and tougher competitor as the guys can now focus on running the business, something they probably haven’t been able to do for years."

Commenting on Polestar’s future, Benham-goodhead-print group sales director Bob Caley said: "For Polestar web offset to be successful, they’re going to have to invest in 72pp technology."

While Polestar’s balance sheet, which has been significantly de-leveraged as a result of the firm’s recapitalisation, could support such investment other observers have suggested that a restructuring of the company, resulting in the closure of some of the older web-offset plants, would be a realistic alternative.

It is not widely thought that investors will be put off the UK print industry despite Investcorp’s losses from Polestar.

Previous refinancing
2001: Investcorp puts £73.1m cash injection into Polestar
2004: Investcorp injects further £74m into Polestar’s “True North” initiative Loan notes totalling £200.8m novated to Polestar’s immediate holding company for one ordinary share Banks reschedule £50m of debt repayments
2005: Investcorp injects a further £100m into “True North”
2006: Polestar defaults on its debt repayments. Senior debt holders take control of the company. A debt-for-equity swap results in £700m losses for Polestar’s investors