British Gas will acquire Robin Hood, the Nottingham-based city council-run company.
The Telegraph reported the plans, where the sale will be completed in September for an undisclosed amount.
In the process, 250 members of staff will be made redundant. It is a blow to the Nottingham city council. The council-run energy company was not-for-profit and had gained support from Jeremy Corbyn, Nicola Sturgeon, and Sadiq Khan.
The 112,000 residential customers and its 2,600 business customers will be transferred to British Gas later this year.
“Given the current economic climate and the further levels of investment needed to enable the company to compete in an extremely difficult market, the review concluded that a sale was the right option,” said David Mellen, Nottingham council leader.
“It provides the best possible deal for the Council and city residents and reassurance to customers that they are transferring to a large, well-established company.”
“We know this is a very sad day for the business and its employees who have played a part in creating a more dynamic and customer orientated market for all energy consumers.”
In the financial year ending in 2019, Robin Hood reported a £22.5m loss.
Chris O’Shea, Centrica’s chief executive, said: “As well as our actions to simplify and modernise our business, we are focused on returning to profitable growth in our core markets and investing in value generating opportunities.”
“Our customers are at the heart of everything we do, and we are delighted to welcome Robin Hood customers to British Gas. ”
“We are pleased to be able to offer every customer moving to British Gas a tariff which means their price will not be any higher and, importantly, they will be supplied with green electricity and have access to a range of other benefits – such as British Gas Rewards with free energy days and exclusive offers on services such as boiler cover,” he added.