The 192,000 square foot facility in Aurora will produce corrugated packaging and include a design lab and a technical centre with the first phase of production at the facility starting in March.
Kapstone said the plant will enhance sales coverage in the Midwest.
Matt Kaplan, KapStone's president, said: “We are very optimistic that KapStone will deliver a very high level of service and quality of corrugated products that will enable us to continue to grow our operations."
KapStone Kraft Paper Corporation includes three paper mills and 14 converting locations and a lumber mill and employs 2,700 people.