Insurance broker Towergate has made the first of a number of expected sell offs as it strives to balance the books amid heavy losses.

The Kent-based company, which is the largest privately-owned insurer in the UK, has sold its air insurance arm Hayward Aviation to global broker Jardine Lloyd Thompson.

The deal is worth £27m in cash to Towergate, which told bondholders it might not survive as a going concern if a restructuring cannot be agreed.

It revealed last month it has hired Evercore and Rothschild to consider takeover bids for the company.

US-listed broker Marsh & McLennan is said to be considering making a bid while the Kent firm’s founder Peter Cullum, who remains its deputy chairman, is also said to be weighing up a management buyout for the business he set up in 1997.

Towergate’s struggles have been partly caused by an aggressive acquisition spree and huge interest payments on £1bn of debt.

Last month it announced pre-tax losses of £112.7m in the nine months to the end of September, up from £19.1m during the same period last year.

Hayward Aviation generated £10m of revenues and reported pre-tax profits of £3m last year.

The firm will be integrated into Jardine Lloyd Thompson’s existing aviation business. The deal is likely to be approved early next year.

Bondholders at Towergate were invited to take over equity in the company last week in a letter from Evercore, which sounded the warnings about potential bankruptcy.

Its chief executive Mark Hodges resigned in October leaving executive chairman Alastair Lyons, the former Serco boss, to run the company.

The insurer, which is backed by private equity firm Advent, employs more than 5,000 people across more than 100 offices in the UK, including its head office in Eclipse Park in Maidstone and bases in Sevenoaks and Whitstable.