Babcock International Group, the FTSE-250 government contractor, is in talks to offload the bulk of its emergency aviation services division, which counts Britain's Air Ambulance fleet among its operations.
Sky News has learnt that Babcock is in advanced negotiations with Ancala Partners, a London-based infrastructure investor, about acquiring a substantial chunk of the business it acquired in 2014.
Babcock, which handles the maintenance of the UK's nuclear submarine fleet, paid £1.6bn for Avincis eight years ago, but the deal rapidly became a huge financial and operational burden for the London-listed company.
Selling the division, which accounts for the bulk of last year's aviation sector revenues of £854m, will effectively unwind the Avincis deal for Babcock, crystallising a substantial loss of value for shareholders in the embattled company.
Archie Bethel, Babcock's former chief executive, was forced into a near-£400m write-down in the value of the business, and his successor, David Lockwood, has opted to focus instead on more profitable operations.
It was unclear on Tuesday whether the UK Air Ambulance fleet would form part of the sale to Ancala.
If completed, the transaction is expected to value the Babcock division at somewhere in the region of £100m.
Babcock has already sold the oil and gas helicopter aviation arm which services offshore oilfields in the UK, Denmark and Australia.
It received just £10m from that disposal to US-based CHC Helicopter.
Babcock has experienced a tumultuous period, with its accounts spanning several years under scrutiny by the audit watchdog.
Shares in the company were trading at around 333.9p on Tuesday morning, giving the company a market capitalisation of approximately £1.75bn.
Babcock and Ancala declined to comment.