The future of a closure-threatened Selby factory has been secured following a multi-million pound takeover by a Belgian company.

Rigid Paper Limited, which employs nearly 250 people at its site in Denison Road, Selby, has been bought by VPK Packaging Group, one of Europe's biggest independent paper manufacturing and packaging groups.

There was a big question mark over the Selby factory's future. It is part of Rigid Group Limited, which incurred such heavy losses two years ago that shareholders demanded the firm be sold as soon as there were signs of recovery.

Steve Roache, production director at the Selby mill, said: "The group was recovering, but we didn't have the resources to re-invest - and without investment you die.

"VPK is a big European outfit, and the takeover is fantastic news for our company and its workforce."

Rigid paper was in such poor shape a couple of years ago that more than 50 workers at Selby were made redundant.

But Mr Roache revealed today they were now planning to recruit 16 workers to man a new machine making cardboard boxes, subject to Board approval.

Frank Holden, managing director at Selby, said today: "We're all extremely pleased we have been bought by someone like VPK because it secures our future.

"The shareholders were frightened by the group's very poor results in 1998, and we were losing considerable amounts of money over a two-year period.

"It was a very serious situation, but we have made major improvements since then and we were a respectable business to acquire.

"I can foresee that once we have consolidated our position, VPK will want to expand its operation at Selby."

VPK employs 2,350 people at its 24 production and commercial sites in Belgium, France and Holland - and Rigid Paper was its first UK acquisition.

Mr Holden said VPK was capable of investing in the Selby mill to fully exploit the opportunities now apparent in the UK market.

He added: "We have a lot of experience and knowledge at Selby - that's one of the reasons they bought it - and VPK's product range is very similar to ours."

The Denison Road factory produces 70,000 tonnes of recycled paper and corrugated cases a year, compared to VPK's 350,000 tonnes.