The closure of the Scarborough-based company, with job cuts totalling 190, seemed inevitable after the closure of the company's printing department last January.

A period of consultation will now commence with local union representatives and officials.

The news brings the total number of job cuts announced in the print and packaging industry in the past fortnight to 727 following the proposed job cuts at Sappi and Johnston Press and the closure of Bovince, Curtis Fine Papers and Beith. A further 80 jobs will be lost at Curtis if a buyer is not found.

Polestar said the closure was a result of recent investment in new finishing equipment and the proposed closure will be completed in January next year.

Catherine Hearn, chief operating officer at Polestar, said: "The Ferag finishing lines we have acquired recently give us the opportunity to relocate finishing from Greaves to our other print sites, thereby improving efficiency and reducing transportation."

The finishing department was used to bind and wrap magazines for publishers including Telegraph, Bauer, News International, Observer, IPC and Express. This work will transfer to other Polestar sites.

Tony Burke, Unite assistant secretary general, said that the closure comes as "no surprise" following the closure of Polestar Greaves' printing plant. However, he added that it was significant blow to Unite members and the community in Scarborough.

"This closure represented another hammer blow to the print and packaging industry which is already reeling from the closures of Curtis and Beith and the announced job cuts at Sappi and Johnston Press," he said.

He laid much of the blame at the feet of the energy companies saying that soaring energy prices were piling on the pressure for the energy intensive manufacturing industry.

He added: "Champagne corks have not stopped popping in the board rooms as these companies announce massive profits while the industry suffers."