Volkswagen's Everllence Unit Attracts Interest from Blackstone and Yanmar

Two major players, Blackstone Inc. and Yanmar Holdings Co., have reportedly expressed interest in acquiring a controlling stake in Volkswagen AG's heavy diesel engine subsidiary, Everllence SE.

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Volkswagen AG's heavy-duty diesel engine unit, Everllence SE, is drawing attention from potential buyers, with Blackstone Inc. and Japanese industrial equipment maker Yanmar Holdings Co. emerging as the frontrunners, according to sources familiar with the matter.

Blackstone, an American multinational investment firm, and Yanmar, a leading Japanese industrial equipment manufacturer, have reportedly entered into the race to acquire a majority stake in Everllence SE, which has been in Volkswagen's portfolio since 2015. The news comes as Volkswagen continues its efforts to streamline its business and focus on its core automotive operations.

According to the sources, both Blackstone and Yanmar have held preliminary talks with Volkswagen about the potential acquisition. While the details of the negotiations, including the price and terms, are still under wraps, it is believed that Volkswagen is looking for a buyer willing to pay around €3 billion for the unit.

EverllENCE SE, headquartered in Ansbach, Germany, is a leading manufacturer of heavy-duty diesel engines, with a focus on the European market. The company's product portfolio includes engines with power outputs ranging from 110 kW to 1,500 kW, catering to various industries such as construction, transportation, and power generation.

Blackstone's interest in Everllence SE comes as the firm continues to expand its presence in the industrial sector. In recent years, the firm has made several high-profile investments in this area, including the acquisition of a majority stake in Italian industrial gas company, Linde AG's engineering division, and the purchase of a minority stake in German industrial group, Thyssenkrupp AG.

For Yanmar, the potential acquisition of Everllience SE would mark a significant expansion of its presence in the European market. The Japanese firm, which already operates in Europe through its subsidiaries Yanmar Europe and Yanmar Power Technology Europe, has been looking to strengthen its position in the region.

Volkswagen's potential sale of Everllience SE is not a surprise, as the company has been working on shedding non-core assets to focus on its core automotive business. In 2020, Volkswagen announced its plans to sell its truck business, MAN Truck & Bus, to Traton SE for €5.1 billion. The sale is expected to be completed by the end of 2021.

With the potential acquisition of Everllience SE, both Blackstone and Yanmar stand to gain a significant presence in the heavy-duty diesel engine market. The outcome of the negotiations remains to be seen, but one thing is certain: Volkswagen's decision to explore a sale of the unit has attracted the attention of some heavy hitters in the industry.

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