The Pike River coal mine will be sold to state-owned Solid Energy.
The mine's receivers, PricewaterhouseCoopers, have reached agreement to sell the mine, conditional on due diligence.
Settlement of the sale is expected by May.
No further details about the sale, or the price, will be released until it becomes unconditional.
PricewaterhouseCoopers can not say how much money could be returned to creditors as a result of the sale.
Twenty-nine men died in explosions in the West Coast mine that began on 19 November 2010.
John Fisk, a receiver with PricewaterhouseCoopers, says negotiations will continue with the Crown to establish a trust to oversee the recovery of bodies.
Mr Fisk says Pike River Coal has about $23 million of secured debts and $10 million of unsecured debts.
The Grey District mayor says he is confident the sale of the Pike River coal mine will go ahead.
Tony Kokshoorn says this is great news for the region, as Solid Energy has enough cashflow to make the mine work.
Tony Kokshoorn says they can now push forward with a plan to recover the men's bodies.
Energy and Resources Minister Phil Heatley says he expects best endeavours to be made by Solid Energy to recover the remains of 29 dead men from inside the mine.
He says the Government will work with the receivers and Solid Energy, to transfer Pike River's mining permit and access arrangements.
On Thursday it emerged nine recovery workers are to be made redundant by the receivers, partly because of the continued cost of the recovery.
The families bereaved by the Pike River Coal Mine tragedy have responded tearfully to news of the mine's sale to Solid Energy.
A families' spokesperson, Bernie Monk, says Solid Energy has long promised it would make every effort to recover the remains.
"I think we're dealing with somebody that's got honesty, we're dealing with a firm that's said all along they're going to go on and get these guys."
Mr Monk said the families appreciated the recovery will take time but that they had the got the utmost faith in Solid Energy.
Solid Energy is not commenting on the announcement.