Volkswagen has secured preliminary offers that put a price tag on its diesel engine and related industrial business Everllence at about 8 billion euros including debt - roughly $9.44 billion at the exchange rate cited in the dossier - according to three people briefed on the discussions. That valuation is higher than some analysts had anticipated and, if realised, would make the disposal one of the larger European carve-outs this year.
Everllence manufactures engines used in shipping as well as heat pumps. The asset has attracted interest from private equity investors and one industrial buyer, reflecting demand from acquirers for established industrial operations that appear less exposed to disruption from artificial intelligence, the sources said.
Among the private equity groups that submitted bids were Brookfield, CVC and Blackstone, according to two of the people. A fourth person said Japanese diesel engine maker Yanmar also put forward an offer. The four people spoke on condition of anonymity because the sale process remains confidential.
Volkswagen initiated the request for bids in mid-February and has recently informed some parties that they will proceed to a second round, two sources said. One of the people said binding offers are expected within the next six weeks as the company advances the process.
Separately, Porsche SE - the holding company controlled by the Porsche and Piech families - has been reported to be weighing an investment in Everllence, the original reporting noted. The outcome of that consideration was not detailed by the people contacted for this report.
Volkswagen declined to comment on the matter. Porsche SE also declined to comment. Yanmar declined to comment, and the private equity firms named - Blackstone, CVC and Brookfield - likewise declined to comment, according to the people familiar with the talks.
($1 = 0.8473 euros)
Context and market implications
The sale process highlights a broader flow of non-core industrial assets moving from corporate owners into the hands of buyout funds and strategic buyers. For dealmakers, assets like Everllence offer stable industrial cash flows tied to shipping and heating technologies and are seen as less likely to face immediate disruption from AI-driven competition, according to the sources briefing the process.
For Volkswagen, the potential disposal forms part of a strategic review of the unit as the automaker considers portfolio streamlining and capital allocation options.