Capita, the business outsourcing giant, is understood to be preparing a bid for ailing insurance service provider Miller Fisher.
Miller Fisher was in talks with an unnamed buyer, thought to be Capita, five months ago, which broke down after just a month.
Since then, Miller Fisher's share price has plunged.
The company has lost 95% of its market value and is worth just £5.3m, compared to £36m at the time of earlier bid talks and £146m when its shares were at an all-time high.
Miller Fisher appointed HSBC to consider the future of the company last November.
Capita has made a series of acquisitions recently.
In May, it paid £33m for McLarens Dick, the British loss-adjusting arm of McLarens Toplis and the second largest loss adjusting company in the UK, while last year it bought outsourcing firm Eastgate.
Miller Fisher bought a rival business, Pycroft & Arnold, in 1999, but has suffered from insurers cutting down loss-adjusting panels and issued a profit warning last year.
It sold off Homecare, its underperforming insurance arm, which provided cover for mobile phones and other electrical goods, for £4.5m earlier this year.
Miller Fisher is currently undertaking a management shake-up, which will see a number of redundancies.
Jim Douglas and Terry Hallas, former directors of Pycraft & Arnold prior to its acquisition by Miller Fisher in 1999, are to lose their jobs.
Other former directors have been offered positions elsewhere in the company.
Newly-appointed group chief operating officer Tom Anderson said the move was part of the group's reorganisation into a single trading entity.
Last week Miller Fisher predicted favourable first-half results, compared to an operating loss of £80,000 for the first half of 2000.