Prime Highlights
- Volkswagen is selling a 51% stake in Everllence to Bain Capital for approximately €7.4 billion, one of Europe’s biggest industrial carve-outs this year.
- Volkswagen CEO Oliver Blume said the deal would help Everllence grow in data centres, energy, and shipping while freeing Volkswagen to focus on its core business.
Key Facts
- Everllence, formerly MAN Energy Solutions, produces diesel engines for the shipping industry and is expanding into data centre power generation.
- A leveraged buyout is a transaction in which a company is acquired largely using borrowed money.
Background
Volkswagen has agreed to sell a 51% stake in its diesel engine unit, Everllence, to Bain Capital in a deal generating proceeds of about €7.4 billion ($8.4 billion). The leveraged buyout is expected to rank among the European industry’s biggest carve-outs this year.
Volkswagen will retain a 49% stake in Everllence in the medium term, remaining a major shareholder under the new ownership structure. The German automaker has been seeking to free up cash amid deep cuts across its automotive operations.
Volkswagen CEO Oliver Blume said leaner structures and processes would allow Everllence to grow in markets such as data centres, the energy sector, and shipping. He added that the deal would allow Volkswagen to focus more strongly on its core business.
Bain Capital beat out rival bidders CVC and EQT in the process. EQT had formed a consortium with Porsche SE and Qatar, two of Volkswagen’s top shareholders. Porsche SE holds 53.3% of voting rights in Volkswagen, while Qatar holds 17% through its sovereign wealth fund.
Everllence, formerly known as MAN Energy Solutions, manufactures diesel engines for the shipping industry. The business also sees growth potential in artificial intelligence through demand for generators powering data centres.
The transaction remains subject to employee negotiations and regulatory approvals, which Volkswagen aims to complete by the end of this year. Five company sites across Germany will be retained under the new ownership structure at least until the end of 2030. As of the final week of May, Everllence carried a book value of approximately €3.4 billion on Volkswagen’s balance sheet.
