The Co-op Group is in talks to sell its petrol forecourts division for £450m as it seeks to reduce its debt pile and strengthen its balance sheet.

Sky News has learnt that Britain’s biggest mutual is in advanced negotiations to offload roughly 130 fuel retailing sites across the country.

Sources said on Friday the business was expected to be sold to a trade buyer, with a deal potentially being agreed in the coming weeks.

Bankers at Rothschild are advising the Co-op on the deal.

News of the prospective sale comes in the same week that the company announced the appointment of Shirine Khoury-Haq as its first female chief executive.

The group, which is best known for its supermarkets and funeral care operations, is striving to reduce its borrowings at a time when inflationary pressures and deteriorating economic backdrop are expected to hamper its profitability.

If the sale of the fuel retailing arm goes ahead, it will be the latest in a series of divisions to have been offloaded by the Co-op over the past decade.

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It previously disposed of its chain of pharmacies and travel shops, and is no longer a shareholder in the Co-operative Bank after a number of crises that almost led to its collapse.

Other petrol retailers have also explored sale processes in recent months, though a £4bn auction of Motor Fuel Group is unlikely to proceed for the time being because of the state of debt financing markets.

The Co-op declined to comment on the talks about the potential disposal of its petrol forecourts.

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