Sky News has learnt that the Universities Superannuation Scheme (USS) is among the preliminary bidders for Park Holidays, the owner of more than 30 sites across the south of England.
City sources said that USS had submitted an initial offer in recent weeks, pitting it against private equity firms including KKR and PAI Partners.
Listen and subscribe to The Ian King Business Podcast here.
USS, which has £82bn of pension assets under management, is a shareholder in some of Britain's most prominent companies, including the motorway services operator Moto, Thames Water and NATS, the company which controls the UK's commercial airspace.
Its interest in Park Holidays follows a decision by the investment firm Intermediate Capital Group (ICG) to hire HSBC and Royal Bank of Canada to run an auction of the business.
The company is the biggest operator of its type in the south of England, with 33 parks under its ownership, including at Dawlish in Devon, Felixstowe in Suffolk and Birchington in Kent.
It offers caravan and lodge holidays, touring and camping, and holiday home ownership.
A precise valuation for Park Holidays was unclear on Wednesday, but it is expected by analysts to be worth over £500m - well above the £362m that ICG paid to buy the company from Caledonia Investments in 2017.
The pandemic's impact on overseas travel has spurred a glut of domestic holidays in Britain, with that trend expected to continue into next year and beyond.
Other recent deals in the sector have included CVC Capital Partners buying Away Resorts - the owner of well-known holiday parks such as Whitecliff Bay on the Isle of Wight and Sandy Balls in the New Forest - and subsequently combining it with Aria, another operator.
Bourne Leisure, the owner of Butlin's and Haven, was sold in February to Blackstone, another major buyout firm.
A USS spokeswoman declined to comment.