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Report: Volkswagen's Renk to be sold first in series of divestitures

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Report: Volkswagen's Renk to be sold first in series of divestitures

Volkswagen AG is likely to start the sale of transmission unit Renk AG in the autumn, Reuters reported June 4, citing people familiar with the matter.

The move is reportedly part of the German carmaker's efforts to streamline its business in a bid to free up funds for investment in electric vehicles.

In May, Volkswagen's supervisory board requested its management to explore options, including joint ventures, partnerships, or a full or a partial sale, for Renk and its diesel engine business MAN Energy Solutions.

According to the report, the auction is expected to begin after the summer break. Citigroup Inc. is reportedly advising Renk, and the business could be valued at up to €800 million, including debt.

The automaker is looking to sell the transmission unit to private equity firms such as PAI Partners, CVC Ltd., Advent International Corp., Bain Capital LP, EQT Corp. and KKR & Co., Reuters said.

Volkswagen did not immediately respond to S&P Global Market Intelligence's request for comment.

The sale of MAN is expected after the divestiture of Renk, the news wire said. Volkswagen reportedly could also off-load motorcycle brand Ducati after it canceled the sale of the unit in 2017.

The report comes a day after Volkswagen disclosed plans to list its commercial vehicles unit Traton on the Frankfurt Stock Exchange and Nasdaq Stockholm.