Key facts
- Volkswagen is selling a majority stake in its marine engine unit, Everllence, to Bain Capital.
- The deal is expected to generate €7.4 billion for Volkswagen.
- The transaction values Everllence at over €9 billion.
- Bain Capital was selected over rival private equity firms CVC and EQT.
- The deal is expected to close by year-end.
Volkswagen shares rose 2.4% after the German automaker announced it is selling a majority stake in its marine engine unit, Everllence, to U.S. private equity firm Bain Capital. The deal, which is expected to generate €7.4 billion ($8.41 billion) for Volkswagen, values the business at over €9 billion.
Volkswagen CEO Oliver Blume has been working to streamline the company's portfolio to concentrate on its core automotive business, which faces challenges from tariffs, Chinese competition, and the costly transition to electric vehicles. Bain Capital secured the stake after a bidding process that also included private equity firms CVC and EQT. The transaction is anticipated to be finalized by the end of the year.
An analyst from JP Morgan noted that the transaction would significantly strengthen Volkswagen's financial position as it progresses with its transformation.