Friends Provident, the embattled life assurer, is close to transferring about a third of its £980m pension scheme to Aviva, the UK’s biggest insurer, in a deal that could be announced as early as Thursday.

The move, which will see a portion of Friends’ pension liabilities managed by Norwich Union, the brand under which Aviva trades in the UK, represents the latest element of restructuring at Friends.

The tidying up, could also potentially make Friends, which recently rejected a £3.5bn approach from JC Flowers, the US private equity group, easier to sell.

JC Flowers walked away last month after Friends’ chairman, Sir Adrian Montague, refused to enter into talks.

The deal represents the latest transfer of the pension liabilities of a FTSE 100 company to a specialist in this market.

However, it is the first involving Norwich Union, which has been active in the so-called bulk annuity market, whereby companies pay insurers a premium for taking on their pension liabilities, for the past couple of years.

Earlier this week, Lonmin became the first FTSE 100 company to offload its pension liabilities to an insurance group, striking a deal with Mark Wood’s Paternoster, a company formed to take pension risks off the hands of employers.

Two years ago, Friends closed its defined benefit pension scheme to new members and forced staff in the scheme to choose between increasing contributions or retiring later. Its main defined benefit pension scheme had a small surplus at the end of last year, according to the report and accounts.

Friends is undergoing a restructuring, that will see it overhaul its business model, and sell off non-core assets.

First round bids are being submitted for Lombard, its European wealth management business, while Pantheon, an intermediary, and Friends’ 53 per cent stake in F&C are also attracting interest.

Friends declined to comment.