Create a new company starting with the oldest year.

No.

What about the transactions that are already posted to the later years in AP, GL, Bank etc? Can I copy transactions for the entire year to the new database or copy batch by batch?

You have to start over, batch by batch.

No
You need advanced support, not something to be explained in this forum. There is a way to perform that, but it requires in depth knowledge of the database and the skills to do it. How much is it worth to you?

We have a few such companies - is there a Third Party product that can do this efficiently? If it requires editing various tables, is there a process/procedure that could be followed?

Unless you're an experienced Sage 300 consultant, you should either contract with one, or start over. Based on your other posts, your databases weren't set up properly in the first place.

There are steps to be followed, but as I stated before this is advanced stuff that cannot be explained in a forum like this.
It's kinda like calling your doctor and asking him to explain heart bypass surgery so that you can fix your friend's problem.

Ok, Thanks for all the encouraging comments!