Bain Capital and Lone Star Funds have progressed to the second round of bidding for Mitsubishi Electric’s automotive equipment business, according to Bloomberg.

The carve-out could be valued at approximately $1.9bn, according to an earlier Bloomberg report. The business produces inverters, motors, car navigation systems, and in-car entertainment components for hybrid and electric vehicles.

The auction forms part of Mitsubishi Electric’s structural reforms. The company has stated it will determine this fiscal year whether to retain or divest businesses accounting for roughly ¥800bn, or around $5bn, in annual sales.

The asset operates in segments facing intense pricing pressure, exacerbated by slower global electric vehicle demand.

A successful transaction would represent another significant Japan carve-out opportunity for global private equity firms, as corporates streamline portfolios and sharpen capital allocation.

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