Work has started on a £6.5 million project to build two large industrial units at Redruth covering a massive 130,000 sq feet and creating an estimated 170 jobs.

Midas Developments has secured £2.27 million of Objective One funding towards the project on the Cardrew Industrial Estate, making it the largest private-sector led development to be approved to date under the Objective One programme.

The larger of the two units, covering 75,000 sq feet, will be occupied by Stralfors plc, the specialist lottery printing and information transfer company that is expected to relocate from its existing premises in Falmouth next year. The second unit will be marketed nationwide to attract a high value business to Redruth.

The announcement comes less than a week after Regeneration Minister Tony McNulty approved the formation of an Urban Regeneration Company for Camborne, Pool and Redruth, heralding a new dawn in the fortunes of the area.

Terry Murch, Director of Midas Developments, said: "This is one of the largest development projects ever undertaken by us in Cornwall and we're already confident of its long term success and of the benefits it will bring to the county in terms of securing and attracting jobs.

"We hope that our financial commitment to and confidence in the Redruth and Camborne area, our success in bidding for Objective One funds and securing a major international company like Stralfors as an end-user, will lead the way for other private sector developers to come forward to work with the public sector on major regeneration projects like this one.

"I'd also like to thank BLS Estates in Truro for their help and support in making the successful grant application - they will now work with us to market the second 60,000 sq ft phase of development."

Mike Murphy, managing director of Stralfors Plc, said: "Our success in winning substantial contracts in recent years means we are outgrowing our premises at Falmouth and now require a state-of-the-art facility.

"The new factory will enable us to grow our business and expand through the use of new technology, and our investment underlines our continued commitment to Cornwall."

Bill Bawden, Objective One programme director, said: "This project will have a substantial impact on the local area and is the largest industrial development we have funded to date. It will not only safeguard jobs at Stralfors and allow the company to expand in the future, but will also create an estimated 170 new jobs when the second unit it occupied."

Swedish-owned Stralfors employs 150 staff at Falmouth and combines generations of printing expertise with cutting-edge technology to provide a wide range of services including security printing and critical information transfer.

Clients include the public sector (National Blood Service, NHS Trusts, DVLA, Prison Service); financial services sector (TD Waterhouse, HSBC, Lloyds TSB); retail (Next; John Lewis); utilities (Centrica, Scottish Power) and gaming and leisure (Camelot, Tote, Best Western).

Stralfors expects to move from its current premises on the Tregonnigie Industrial Estate in Falmouth in May of next year.