The owner of the Monarch airline and travel group is being tipped as considering selling the business 17 months after rescuing it from the brink of collapse.
Investment firm Greybull Capital, which bought Monarch in October 2014 as a "long-term investment", is reported to have appointed Deutsche Bank to explore the company's growth options in Europe, which could include selling or merging with a distressed airline.
Budget rivals such as easyJet and Norwegian are being looked at as potential buyers, and the company has considered Air Berlin as a possible target for a merger, according to the Sunday Times.
Greybull has returned the carrier to profit in its 17 months as owner.
Monarch, which carries about 6.6 million passengers a year, posted £40 million of underlying profits before interest and taxes for the year to the end of October.
The previous year, as Greybull acquired the company, it reported a loss of £94 million.
A Monarch spokesman denied that there is a "sale process" underway but told the Daily Telegraph: "Monarch has sought the assistance of Deutsche Bank who will look at both inbound and outbound opportunities."
They added: "Monarch has executed a successful turnaround, is now a strong and stable business and is therefore ready to look at growth opportunities in Europe."
Turnaround experts Greybull instigated a £200 million cost-cutting scheme when it bought Monarch.
It invested £125 million in the company as well as reducing its fleet from 42 aircraft to 33, cutting 700 jobs, and slashing pay by between 30% and 35%.
It also shifted the carrier's focus to low-cost scheduled flights and cut long-haul routes.
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