The fresh investment follows an extension of the firm's contractual arrangements with News International (NI) with the firm being awarded a 15-year contract to print titles at the Sheffield plant.

Johnston Press chief executive Tim Bowdler said he was delighted by the news. "It's one of those win-win situations and makes a huge amount of difference, by allowing us to accommodate a major part of NI's needs."

Bowdler also confirmed that press equipment had been decided upon for the new plant, with a MAN Roland triple width, 12 unit, three folder press on order.

A decision is still to be made on the CTP supplier for the plant.

He declined to reveal details of the specific NI titles that will be printed at the site, but said there were guarantees of volumes.

Although he said the new contract was specifically for Sheffield, he said he hoped the firm would still be able to maintain its NI capacity elsewhere. Confirmation of the NI  deal for Sheffield, strengthens the relationship between the two companies.

NI already uses Johnston's Northeast and Portsmouth printing facilities. Work remains on track to secure the greenfield site for the new plant in Sheffield, which Bowdler acknowledged was a huge project. The Sheffield plant is due to be fully operational by the end of 2006.

Story by Andy Scott