The publisher of two of Britain's biggest-selling regional dailies is to shed around 135 jobs and merge two companies as it looks to reduce costs by around £3m per year.

The Midland News Association, publishers of the Wolverhampton-based Express and Star and Shropshire Star and associated weeklies, will be merging some parts of production, finance and classified advertising.

There will also be structural changes in editorial, advertising and circulation but the company stressed both daily titles would retain individual editors, journalists and identities. District editions of both dailies will also continue unchanged.

Voluntary redundancies are now being sought with a view to reducing staffing levels by around ten per cent.

The company said it had seen a dramatic decline in the key advertising revenues of employment, motoring and property.

A single board of directors will now oversee both papers and their sister weeklies titles, headed by current Express and Star Ltd managing director Alan Harris.

Shropshire Newspapers MD Colin Spicer will stay in his current role and work alongside Mr Harris in the merger.

Printing of the Express and Star will move out of the West Bromwich plant to other print centres within the group but some weekly titles will still be printed there.

MNA chairman Douglas Graham said the changes would make significant savings at both centres and hoped the company would become a "fully-integrated media business".

John Corser, Father of the Express and Star and Chronicle NUJ Chapel, said the company told staff it was looking to shed around 135 jobs across the whole group.

He added: "At the moment we don't know the full ramifications in editorial.

"There will be departmental meetings but the number of redundancies is unspecified across departments.

"Hopefully, there won't be any compulsory redundancies in editorial.

"And we wouldn't like to see anything happening that would reduce the number of editorial staff drastically."

John said he had been reassured that district offices would remain open.

NUJ northern organiser Chris Morley added: "This is yet another major blow for journalism in the West Midlands, coming hard on the heels as it does on massive redundancies at Trinity Mirror titles in the region and at ITV Central.

"We have yet to see Midland News Association's full proposals but we shall be seeking reassurances that any job losses that are made are not compulsory and that the company remains committed to its policy of keeping its editorial resources local."

In May, Express and Star Ltd centralised all editorial staff on its Chronicle series of free weeklies.

The papers, which cover Wolverhampton, central and south Staffordshire, Kidderminster, Stourbridge and parts of the Black Country, are now written and subbed from Wolverhampton head office.

A similar centralisation is expected early next year for the Shropshire weekly papers with all sub-editors moving to the head office in Telford.

This latest moves follows a round of 70 redundancies in April 2006.

A staff meeting is being held in Wolverhampton today with a meeting for National Union of Journalists members expected within the coming days.