Apr 12, 2018 Federal-Mogul, Champion, Automotive, aftermarket, parts, Tenneco,
Tenneco has announced that it will purchase global OEM and aftermarket supplier, Federal-Mogul, from Icahn Enterprises, for US $5.4 billion. Tenneco also announced its intention to separate the combined businesses into two independent, publicly traded companies - an aftermarket & ride performance company and a powertrain technology company.
Should the deal be granted regulatory and shareholder approval, it is expected to close later this year. “This is a landmark day for Tenneco with an acquisition that will transform the company by creating two strong leading global companies, each in an excellent position to capture opportunities unique to their respective markets,” said Brian Kesseler, CEO, Tenneco.
Icahn Enterprises Chairman, Carl C. Icahn commented: “Icahn Enterprises acquired majority control of Federal-Mogul in 2008 when we saw an out-of-favour market opportunity for a great company. During that time, we have built one of the leading global suppliers of automotive products. I am very proud of the business we have built at Federal-Mogul and agree with Tenneco regarding the tremendous value in the business combination and separation into two companies. We expect to be meaningful stockholders of Tenneco going forward and are excited about the prospects for additional value creation.”
Aftermarket & Ride Performance Company
The combination of Tenneco’s Ride Performance business with Federal-Mogul’s Motorparts business will boast an impressive portfolio of some of the strongest brands in the aftermarket including Monroe®, Walker®, Wagner®, Champion®, Fel-Pro® and MOOG®. The company expects its broader aftermarket product coverage, stronger distribution channels, and enhanced channel development to strengthen its position in established and high growth markets (China and India), and drive success through new mobility models and capturing evolving e-commerce opportunities. On the OE side of the business, it believes that the combination creates a portfolio of braking and advanced suspension technologies and capabilities that set the foundation for meeting changing performance requirements for comfort and safety as well as taking advantage of the electrification and autonomous driving trends.
Powertrain Technology Company
The powertrain technology company will combine “market leaders with reputations for innovation in meeting the changing needs of customers.” The combined business will offer a robust portfolio of products and systems solutions.
Tenneco's South African office is equally enthusiastic about the acquisition. When asked for comment, Philip Lutz, Aftermarket Product / Pricing Manager at Southern Africa Ride Control said: "We are very excited and positive about the purchase. We do not foresee any major changes in the short term." Lutz added: "Both companies are strong global, product-focused industry leaders and everybody will win!"
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