Managing director of the Werrington-based company Stephen Fitzpatrick said the purchase of the business by Texas-based engineering giant Dresser-Rand would safeguard its future.

Peter Brotherhood has grown dramatically over the last few years, driven by its design and manufacture of high-quality and environmentally sound steam turbines.

Over the last few months, the firm has announced a spate of contracts for its turbines with companies across the world, and particularly for use in the off-shore oil production industry.

The number of staff has soared from 240 five years ago to more than 360 today with turnover tripling over the same period.

During a meeting of the company's 300 strong workforce yesterday to announce details of the sale, Mr Fitzpatrick said: "We have had five years of impressive growth in the business.

"The combination with Dresser-Rand is expected to ensure the continued profitable growth of the business."

President and chief executive of Dresser-Rand Vincent Volpe said: "Both companies have maintained solid reputations for quality, efficiency, economy and reliability."

He said the deal would allow Dresser-Rand to offer a comprehensive line-up of steam turbine and gas compressor products.

News of the deal has also been welcomed by union officials.

Regional officer for Unite Tony Ellingford said: "We feel this is a positive development.

"Dresser-Rand does the same kind of work as Peter Brotherhood, and the two will complement each other."

Union leaders will meet with senior managers tomorrow to explore the implications of the sale in more detail.

But Mr Ellingford said: "One of the results of the sale is likely to be an extension of the Peter Brotherhood facilities. So we are extremely hopeful that this will take place, and we will see more investment in Peterborough."

Operations director of the manufacturers' association, the EEF, Steve Jackson, said: "This sale is not really a surprise. The trend at the moment is for the smaller firms to be picked up by the larger companies.

"But it is a testament to the strength of Peter Brotherhood. Dresser-Rand is not going to buy something that is going to make it a loss."

However, the sale has sparked some alarm among business and civic leaders in Peterborough.

Chief executive of Peterborough Chamber of Commerce John Bridge said: "I would like assurances that the future development of the company will be in Peterborough, and if that is the case, then this sale must be good news for the workers and the city.

"The purchase of Peter Brotherhood is a vote of confidence in a business that has been developed in Peterborough. I hope that Dresser-Rand sees Peterborough as a base."