A greetings card firm in Gloucestershire has been celebrating after sealing a multi-million pound deal which will help it expand and take on 25 more staff.

Paper House Group – which sells 50 million cards each year – has taken over a major competitor in a move which is thought to be worth several millions.

The firm, based at Waterwells Business Park, bought the greetings card division of London-based The Medici Society for a substantial undisclosed sum, in a move which will take annual turnover of the new company to more than £12 million. As a result of the deal the company has increased the number of staff at its headquarters from 95 to 120 and taken on an additional 5,000 square feet of warehouse space to store extra stock ahead of the expected Christmas rush.

Set up in 1980 Paper House is the country's biggest independent card publisher, designing cards for national retailers including WH Smith and Wyevale Garden Centres and smaller independents stores.

The takeover took place with the backing of the Paper House Group's banking partner of 15 years, Lloyds TSB Commercial, which will provide day-to-day services for the enlarged company.

The bank also introduced management to asset based lending specialist Lloyds TSB Commercial Finance, which came up with a package of facilities to fund the acquisition and to support working capital.

The business uses four UK firms to print its cards, including Alpha Colour Printers, which is also based in Gloucester.

Steve Gallagher, financial director of Paper House, said: "This deal was an opportunity to accelerate our growth by acquiring a complementary firm and marks an important chapter in our business's long-term development.

"In order to ensure we maintain our high standards of customer service, we have invested in bringing on additional employees and we are committed to operating the enlarged company from our existing base in Gloucester.

"Lloyds TSB Commercial's support gave us the confidence to take this next step. They took the time to understand our needs and developed a package that ensured we had sufficient working capital going forward."

Guy Webster, regional manager at Lloyds TSB Commercial Finance, said: "With the economic climate becoming increasingly challenging for many UK firms, Paper House Group has taken a proactive approach and acquired a highly complementary firm in order to bolster its offering and enlarge its customer base.

"Our lending is in place to ensure the company's cash-flow is supported both over the busy Christmas period and beyond, and can be scaled up to match the (Gloucestershire) business's requirements as it continues to grow."