Jefferson Smurfit's €243 million (£191.4 million) bid for the 66 per cent of Swedish paper group Munksjo it does not already own is unlikely to be increased even though the 77 krone (€8.4) a share offer price is below the current price for Munksjo stock.

Industry sources believe that, although Munksjo shares are trading on a premium to the Smurfit offer, Smurfit may be reluctant to raise its figure given Munksjo's debt - some €170 million (£133.9 million) - which it will be taking on board.

Munksjo, which was trading at SKr64 before the Smurfit offer, closed at SKr82 yesterday.

There were contrasting views from Stockholm on the likelihood of Smurfit raising its bid. Industry sources said it was unlikely to raise the bid although several major Munksjo shareholders, including SEB Funds, had indicated it was too low.

But fund managers said the bid would be extended.

"Munksjo is really a small cap company and these are rarely valued at their full break-up potential," said a Swedish fund manager.

"At the end of the day, yes, I believe they will up the bid slightly. It is, after all, relatively small money for Smurfit."

(Additional reporting by Reuters)