The Spanish shipbuilder is expected to confirm on Thursday that it is buying Harland and Wolff, the Belfast shipyard best known for the Titanic.
Navantia has been in separate conversations from October after Harland and Wolff's holding company went into administration.
All jobs at the company are expected to be saved in the deal, which is also expected to include Harland and Wolff facilities in Scotland and England.
The BBC understands that it is also expected that an announcement will be made in parliament on Thursday.
Navantia's main shipyard is at Cadiz in southern Spain (Getty Images)
The government could announce that they are improving the terms of that contract to reflect higher costs.
The deal is to be presented as early results of the government's post-Brexit “reset”.
Navantia, which is 100% owned by the Spanish government, has been heavily funded by the European Commission as part of the European Defense Fund.
The aim is to join the UK-EU security reset fund, which will be discussed at a summit early in the new year.
Spain's economy minister responsible for its state industries, Carlos Cuerpo, met Chancellor Rachel Reeves and Industry Secretary Jonathan Reynolds in London last month.
Navantia already has a business relationship with Harland and Wolff. He is the main contractor on a project to build three support vessels for him the Royal Navywith Harland and Wolff acting as a subcontractor in the UK.
The company employs a core workforce of around 1,200 in Belfast, Appledore in England and Methil and Arnish in Scotland.
Navantia's main shipyard is at Cadiz in southern Spain.
It employs over 4,000 people and has an annual turnover of around €1.3bn (£835m).
What is the history of Harland & Wolff?
In 2019, then-owners of H&W withdrew financial support (Getty Images)
Harland and Wolff was founded in 1861 by Yorkshireman Edward Harland and his German business partner, Gustav Wolff.
In the early 20th century, Harland and Wolff dominated shipbuilding around the world and were the most prolific builders of marine vessels in the world.
However, in the period since the Second World War it has gone from crisis to crisis and was under the control of the UK state from 1977 to 1989.
In 2019, its Norwegian owners withdrew financial support and the business fell into bankruptcy, after building a boat in a generation.
The government may announce an improved contract to reflect higher costs (Getty Images)
It was bought by Infrastrata, a small London-based energy company with little experience in marine engineering.
Infrastrata later changed its name to Harland and Wolff and in 2022 won the Royal Navy contract as part of a consortium led by Navantia.
However, financial losses increased as he increased his work and was increasingly dependent on high interest loans from US specialist lender, Riverstone.
The company sought a government loan guarantee of £200m to refinance its loans but that was rejected as too risky for taxpayers.
A holding company into administration in September and restructuring specialist Russell Downs was hired to run the business and find a new owner.
