Devon authorities are to enter into exclusive negotiations with a private healthcare group for a £100m contract to run some of the county's care homes.
Shaw Healthcare's bid will now be examined further
Shaw Healthcare is among 10 bidders hoping to run Devon's domiciliary and in-house residential care services.
Its business plan will now be investigated before recommendations are made to councillors.
The group says it will boost services, although some homes could shut as part of overall changes to residential beds.
Last year Devon County Council invited proposals from care providers to take over and develop its services.
Continuity of care
Its in-house residential and domiciliary care services include 26 care homes.
The council says it has been looking for a solution to ensure continuity of care and investment to pay for new care.
Shaw Healthcare was named as the preferred bidder in a meeting on Tuesday.
It was shortlisted after evaluation by county, district and city councils, service users, carers' representatives, staff and trade unions.
The group, which is jointly owned by its staff and a national charity, runs services across the country.
A report by Devon's Adult and Community Services said the bid would offer the opportunity to ensure continuity of care, more specialist and high dependency care services, extra residential care beds and care homes with modern facilities.
But a small number of homes could close to fund the creation of more residential beds for people with specialist needs.