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Volkswagen has attracted bids from top private equity funds including Blackstone, EQT and CVC for its Everllence division, bolstering its plans to sell off the shipping engines unit.
The deadline for initial offers for the business, formerly known as MAN Energy Solutions, expired last week. The division, which produces shipping engines and heat pumps, is being valued at between €5bn and €6bn by prospective buyers, according to people familiar with the matter.
Other buyout groups to have previously shown interest for the unit include buyout firm CD&R and industrial carve-out specialist KPS, the people said, adding that some rival companies had also explored bids.
VW is planning to spin off a majority stake in Everllence while keeping a significant minority holding.
Offloading Everllence would aid VW in its effort to reshape its business in the face of weaker demand and growing competition from Chinese carmakers.
For 2025, Volkswagen said it generated net cash flow of €6bn from its automotive division in 2025, a significantly better figure than the carmaker had expected as it aims to cut costs.
The possible sale of Everllence comes alongside the auction of ContiTech, the belts and hoses business of German automotive parts group Continental. The Hannover-based group is aiming to focus its operations solely on tyres.
The competing deals come as Europe’s automotive industry faces Chinese competition and a slower than expected transition to electric vehicles. One German investment banker said it was “a very rare situation where you have very similar assets in the same country at the same time”.
Continental has stuck to its plans to divest ContiTech this year, despite the sale coinciding with VW’s auction and a profit warning at the unit last month.
ContiTech’s operating profit margin in 2025 came in at 4.9 per cent after a weak fourth quarter, below the company’s target range.
The tyremaker believed there was still a “good deal” to be made for ContiTech and had pitched the unit’s upside potential to investors, a person familiar with Continental’s thinking said.
Plans by Volkswagen and Continental to divest non-core assets follow a similar trend by other major European industrial groups to sell down assets in order to streamline their businesses as they navigate volatile energy costs, Chinese imports and rising costs from environmental regulation.
Such plans have attracted interest from private equity groups, which see an opportunity to substantially improve divisions with further investment.
Last year there were almost €60bn of European private equity carve-outs up to early November, according to data from market researcher PitchBook, accounting for 13.5 per cent of PE deals by value.
Representatives for Volkswagen, Blackstone, EQT, CVC, CD&R and KPS declined to comment.