Smurfit Kappa has announced the acquisition of Texas-based firm Bates Container.

The company will pay an initial $150m for the corrugated packaging manufacturer, with a deferred payment of around $7.5m to be made at a later date.

Smurfit Kappa said the deal would give it greater reach in the Texas region, where Bates has a long-established customer base.

A large amount of materials will be supplied by Smurfit Kappa's Orange County mill in Dallas, it said, which would help it to create operational savings of $11.5m within two years of the acquisition.

The deal, which will be funded from Smurfit Kappa's cash reserves, is expected to be completed by the end of the year.