Construction services group Amey has been selected as the preferred bidder for the #2.2 billion privatisation of Birmingham's highways network.
Amey was chosen from a shortlist of three by the city council to go to the next stage of what will be Britain's biggest Private Finance Initiative.
The company has until the end of October to submit its best and final offer.
If the offer is accepted by the council and the Government, Amey will be given a 25-year contract to improve and maintain all roads, pavements, bridges, footpaths, street lights and traffic signals in Birmingham.
Nick Dawson, who heads Amey's Birmingham bid team, said: "This project will transform Birmingham. Working alongside the council and residents, tailored services will deliver the renewal of road and pavement surfaces, the maintenance of roadside trees and the upgrading of street lights to ensure safety and security in local neighbourhoods.
"Every aspect of the infrastructure will be improved."
Amey chief executive Mel Ewell said: "We are very pleased to have been chosen to progress to this stage of such a prestigious project.
"Birmingham is enjoying great expansion and Amey is proud to be involved in the continued development of the city. We look forward to working with our partners and the local community to help regenerate the city and the West Midlands region."