A consortium of private equity firms is circling Volkswagen's heavy diesel engine unit, Everllence SE, with a potential valuation near €6bn. Bidders reportedly include EQT, CVC Capital Partners, Advent, Bain Capital, KPS, and Clayton Dubilier & Rice. EQT is weighing a joint offer with Singapore's GIC. First-round bids are due by February 12, though talks remain fluid and a deal is not certain.

Volkswagen is reviewing strategic options for the unit, formerly known as MAN Energy Solutions, which builds ship engines and power-plant turbines. The German automaker faces mounting pressure to boost profits and streamline its sprawling portfolio. This push comes as VW navigates weak demand in key markets and a costly pivot to electric vehicles, forcing it to shed non-core assets and shore up its balance sheet.

Goldman Sachs and JPMorgan Chase are advising Volkswagen on the potential sale, which would rank among Europe's largest industrial carve-outs. Everllence generated €4.3bn in revenue and €337m in EBIT last year. The deal tests private equity's appetite for complex corporate separations and legacy industrial assets. Watch for final bids and whether VW opts for a full sale or a partial stake to a financial partner.