Courtaulds Textiles agreed yesterday to an increased offer from US food and consumer products firm Sara Lee Corp valuing it at £150.5 million sterling (€246 million).

The 145p per share cash offer, seen on the low side by some analysts, compares with Sara Lee's original 100p bid, which Courtaulds had dismissed.

Sara Lee plans to create 300 jobs in Killarney, Co Kerry in the next two years in the manufacture of women's underwear, following its return to the former Pretty Polly plant. Courtaulds employs about 1,640 people in plants in Portadown and Lurgan, Co Armagh, and Limavady, in Co Derry, which produce underwear for Marks & Spencer. Factories in Cookstown, Co Tyrone, and Irvinestown, Co Fermanagh, were closed two years ago and further cutbacks are expected.