BCA Marketplace, an online used-car seller backed by troubled Woodford Investment Management, said it is in advanced talks over a £1.9bn (€2.13bn) takeover offer from TDR Capital.
The company, which runs webuyanycar.com, said yesterday that TDR proposed paying 243 pence a share, which is 25pc higher than Wednesday's closing price.
BCA said its board intends to unanimously recommend the offer to shareholders if TDR announces a firm intention to proceed.
BCA shares surged as much as 23pc to 239 pence.
The move comes as investors abandon funds run by Neil Woodford, who's been seeking to shift positions out of illiquid investments after blocking redemptions from his LF Woodford Equity Income Fund this month.
Woodford's investment firm was the third-largest investor in BCA as of June 1, with his frozen fund holding almost 6pc, according to data compiled by Bloomberg.
The biggest holder is Invesco, Woodford's former employer, where he spent almost 26 years before striking out on his own in 2014.
London-based BCA, which stands for British Car Auctions, runs platforms that allow dealers and consumers buy and sell cars, in addition to services such as polishing and bodywork.
The company, which sells more than 1 million vehicles a year, last year rejected a £1.6bn takeover proposal from Apax Partners.
London-based TDR has investments in French casual dining chain Buffalo Grill, International Car Wash Group and the UK's Pizza Express.
BCA sells to buyers in 55 countries.