NEW YORK – Northrop Grumman has told private-equity firms it is scrapping a plan to sell its shipbuilding business and will instead pursue a spinoff of the unit, three people with knowledge of the matter said.

Bids weren’t high enough to keep pursuing an auction, said one of the people, who asked not to be identified because the talks are private. A sale might have raised $2.5 billion to $3 billion before taxes, while a spinoff may be valued at about $2 billion, the person said. Bain Capital, KKR, TPG Capital and Carlyle Group had been bidding, people had said.

Chief Executive Officer Wes Bush said in July he was studying the future of the shipbuilding unit to focus on defense electronics, drones and surveillance technologies. Los Angeles-based Northrop began acquisitions in 2001 that built it into the Navy’s largest supplier of ships.

Northrop Grumman owns a shipyard in Pascagoula, Miss., that competes with Bath Iron Works in Maine for contracts.

“Shipyards require a lot of management focus and attention, so Northrop would be better served if the ship unit is under a dedicated management team,” said David Rowlett, a Baltimore-based analyst at the mutual fund firm T. Rowe Price, which owns 3.1 million Northrop shares.

After the spinoff, Northrop would be left with three sectors — aerospace, electronics and information systems, whose products include the Global Hawk high-altitude drone, radar for the F-35 and F-22 jet fighters, cyber security systems and the James Webb Space Telescope, expected to be launched in 2014.

“We continue to explore strategic alternatives,” Randy Belote, a spokesman for Northrop, said in an interview. “We don’t comment on specifics.”

The private-equity firms that had bid on the unit are now trying to determine whether it’s final, said one of the people, who asked not to be identified. The firms were informed of the decision this week, the people said.

Northrop filed documents with the Securities and Exchange Commission on Oct. 15 to start the process of spinning off the ship unit as an independent company, which would avoid a tax bill and wouldn’t generate cash. Shipbuilding sales in 2009 were $6.21 billion, or 17 percent of Northrop’s $33.8 billion in total revenue.