The firm has reduced the nominal value of 20m existing ordinary £1 ‘A’ shares in Polestar Print Holdings to create 20m new 10p shares.

Polestar Print Holdings is the parent company of Polestar UK Print and Polestar Bicester.

A share premium account of £837,000 on the firm’s books has also been cancelled.

The reduction in capital has created special reserves of more than £18.8m. Prior to this, the group had distributable reserves of £6.6m based on its most recent accounts, for the year to 30 September 2013.

The directors’ statement confirming the proposal states: “The reduction has been proposed in order to create sufficient distributable reserves within the company to facilities the payment of a dividend to the company’s shareholders.”

The ultimate owner of Polestar Print Holdings is Sun Capital Partners.

“It allows shareholders to recoup some of their investment in the company,” said Polestar group finance director Peter Johnston.

The firm’s B, C and D shares are unchanged. Any dividend payment would also benefit former Goodhead Group owner Sir John Madejski. He converted a debenture held over various Goodhead Group assets into just under 2.3m D shares after the pre-pack sale of Goodhead in 2012.

Madejski’s shares entitle him to 10% of any dividend paid to Sun, which holds the A shares.

According to Polestar Print Holding’s most recently-filed accounts, for the year to 30 September 2013, the £239m turnover group also owed an affiliate of Sun £3.3m in yet-to-be-paid management fees.

Polestar has two major loan repayments coming up next year. Its £13.4m Term B loan matures in June 2016, and the £14.3m Term C loan in December.

As part of the formalities attached to the capital reduction Polestar's directors stated that they knew of no grounds on which the company would be unable to pay or otherwise discharge its debts.