Pewsey manufacturer Shredhouse Ltd is to receive a £60,000 grant to help the business expand.

The company, based on Salisbury Road Business Park, produces high-end giftware packaging for clients including The Body Shop and Estee Lauder.

It is the first business in Wiltshire to receive a Rural Economy Grant, funded by the European Union.

An increase in orders means that the company has outgrown its buildings and needs to extend its premises so stock can be kept onsite.

The grant will cover a third of the building costs and work is expected to start in the middle of February.

Phil Stephens, who launched the family-run business, said: “It’s not often someone gives you a large sum of money so we were pleased to get the grant.

“We had to jump through a lot of hoops for the grant but the business has been going for about 18 years, so we have a strong business plan and we could prove that the business is sustainable.”

The company also leads the field in the UK in developing environmentally-friendly and recyclable products, which are much in demand for presentation and protection.

As a result of the planned expansion, the company will soon be taking on two or three new full-time staff.

Rural Economy Grants are funded by the Rural Development Programme England through the European Agricultural Fund for Rural Development and are administered by Wiltshire Council, working with Defra.