Centrica's £5m swoop for insulation firm

Hillserve, which has 159 staff, was set up in 1985 by founder Harry Hearsum and is now run by his daughter, Julie Hadfield.

Ms Hadfield said the takeover came 25 years to the week after the firm began trading. "We look forward to the next 25 years and beyond as part of British Gas," she added.

The deal comes as Centrica looks to capitalise on increased home insulation spending, which is expected to rise from 600m to 1.4bn by 2015. The firm is planning to take on 1,100 staff in the next 18 months.

Cheshire-based Hillserve trades mainly in Wales and the North-West of England and carried out 40,000 installations last year.

British Gas – which itself completed 270,000 cavity wall and loft insulations in 2009 – is aiming to become the UK's biggest insulation player.

The company previously worked through contractors but wants to bring expertise in-house and plans to grow organically and through acquisitions, recently opening a depot in Reading.

In March the Government also announced a series of initiatives to help cut carbon emissions by encouraging spending on energy saving products.

This includes 'green loans' to homeowners under a Pay As You Save programme which aims to overcome financial barriers – such as upfront costs – which people face in trying to make their homes more energy efficient.

The Government wants to insulate six million homes by the end of 2011, with all practical lofts and cavity walls insulated by 2015.

British Gas estimates that 1 in every 4 spent on heating is wasted due to poor insula- tion.

Hillserve is based in Bredbury near Stockport.

The firm made pre-tax profits of 2.3m on revenues of 14.4m in the year to May 31 2009.