JOHNSTON Press has seen its share price plunge more than seven per cent after its £360 million refinancing plan was approved.

The newspaper publisher, which counts The Scotsman and Yorkshire Post among the titles it owns, received 99.65 per cent backing from shareholders for the proposal at a general meeting in London yesterday.

The company will now press ahead with its £138 million rights issue and a new £220 million bond issue as well as a £25 million credit facility as it looks to cut its debt and find a way to fund digital growth strategies which are key to its future.

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Around 4.6 billion of new shares will be issued to the market as part of the refinancing.

Chief executive Ashley Highfield has been working for months on the package as he believes it will give the business a firmer financial footing by accelerating the repayment of Johnston Press's debt, which stood at £311.9 million at the start of this month, as well as setting loan maturities beyond 2018.

BSkyB had previously subscribed for £2.3m of shares at 17p and it is expected that it will take up its rights in the issue to take its total investment to £5m.

The two companies announced an advertising partnership earlier this month which will see Johnston Press use the Sky AdSmart Local product to create television advertising for specific regional markets.

Johnston Press saw its shares fall 1.25p to 15.75p and said it expects the refinancing to be fully completed by June 30.

Lloyds Bank and Deutsche Bank are among the lenders involved in providing the new credit facility for Johnston Press.