As a result of the deal, Kettering-based AML managing director Tony Mariani said the group will now look to expand further and seek additional staff for its sales, marketing and label printing divisions.

He said the merger ensures the 15-staffed company a "strong and solid future", with a "great alliance to meet future challenges".

Mariani said: "By acquiring Applied Labels we have increased our production capacity, which is a big part of our growth plan.

"It is an exciting opportunity and very positive news in this current economic climate for both the local and national business community."

The two businesses have worked and traded with each other for many years, and Mariani said the deal was a long-term solution to bring stability to the company.

AML, which has a turnover of £1.3m, deals with labelling and bar coding systems while Applied Labels manufactures labels.