Analysts believe Northcliffe - which owns a raft of Midlands titles - is likely to be sold to a private equity firm and be valued at around #1.5 billion.
Media group Daily Mail & General Trust revealed in November it was willing to sell the operation, one Britain's largest regional newspaper publishers, if the price was right.
The surprise decision to consider a disposal of Northcliffe was combined with a warning by DMGT that there was no recovery in sight for its newspaper advertising markets.
Northcliffe operates from 37 publishing centres and produces 20 daily titles that have a combined sale of almost one million copies.
Among its best-known Midlands titles are the Derby Evening Telegraph, Nottingham Evening Post, Leicester Mercury, Stoke Sentinel and weeklies, the Tamworth Herald, Sutton Observer and Walsall Advertiser.
Nationally, other major operations are the Aberdeen Press and Journal, Western Daily Press and Western Morning News.
A spokesman for analysts Numis Securities said trade buyers could not be ruled out but " DMGT wants a quick and simple outcome and, in our view, this suggests that private equity ownership is a likely outcome."
Numis said Northcliffe had "been run to defend readership through editorial investment at the expense of margins".
It operates with a 20 per cent margin, compared to over 30 per cent for rival Johnston Press.
The Numis spokesman said said a valuation in excess of #1.5 billion was possible.
He said a disposal of Northcliffe would mark an historic turning point in the history of DMGT and, "in our view, it highlights the challenges facing the industry, including long-term circulation declines."
He said: "Moreover, a disposal would free up capital to invest in DMGT's faster growing B-to-B assets and could bring about a re-rating for a group which has historically traded at a discount to its sum of the parts."
Northcliffe has a t 27 paidfor weeklies that sell almost half a million copies a week and 62 free titles with a distribution of 2.5 million.
In making the announcement, chairman Viscount Rothermere said shareholders would receive a " substantial portion" of the net proceeds of any sale, but the group may opt instead to restructure the business further.
Northcliffe achieved operating profits of #102 million over the past financial year --up 1.5 per cent on 12 months earlier despite revenues remaining unchanged at #520 million and without the support of an extra trading week.
The slowdown in the economy and lower public sector spending affected its advertising revenues, which declined in the second half of the financial year after an encouraging start.
But the group said it now forecast to make at least #30 million of annual savings from a restructuring that includes plans to close presses at Exeter, Hull, Grimsby and Lincoln.