Volkswagen AG has received preliminary bids valuing its diesel engine unit Everllence at around €8bn, equivalent to approximately $9.44bn including debt, Reuters reported.

The disposal would rank among the largest European carve-outs of the year, underscoring how major corporates are accelerating portfolio simplification and creating sizeable opportunities for private equity capital deployment.

Private equity firms including Blackstone, CVC Capital Partners, and Brookfield Asset Management are among bidders for the business, which produces shipping engines and heat pumps. Japanese diesel engine manufacturer Yanmar has also submitted an offer.

The assets are viewed as industrial operations less exposed to disruption from artificial intelligence, aligning with investor demand for resilient, asset-backed platforms.

Volkswagen invited bids in mid-February and recently informed selected parties that they would advance to a second round. Binding offers are expected within approximately six weeks.

Porsche SE, Volkswagen’s largest shareholder, is also considering investing in Everllence, according to previous reports by the FT.

Volkswagen declined to comment and has previously stated it is reviewing strategic options for the business.

If completed, the transaction would represent a major European industrial carve-out and highlight sustained appetite among global private equity firms for high-quality non-core corporate assets as dealmaking rebounds.

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