In April, Tenneco announced plans to purchase Federal-Mogul for $5.4 billion. Today the Tenneco Federal-Mogul acquisition is complete. Federal-Mogul makes Ferodo and Wagner brake products, along with many other leading auto parts brands.
Federal-Mogul had been part of investor Carl Icahn’s large portfolio. Icahn is now the largest individual shareholder of Tenneco, with a 9.9% stake in the company.
In April, Bloomberg cited one reason for the sale as:
Federal-Mogul’s own customers — retailers like AutoZone Inc. and O’Reilly Automotive Inc. — bristled at the fact the billionaire investor was both their supplier and competitor through his many auto-related holdings, people familiar with the situation said. Icahn owns distributors like Auto Plus and retail shops like Pep Boys.
Icahn purchased Federal-Mogul debt prior to the company’s 2002 bankruptcy. The debt converted to ownership shares, and he continued to acquire larger pieces of the company until he took it private in 2017.
Tenneco plans to split into two companies next year, one focused on powertrain components and one on aftermarket parts.
Earlier in The Brake Report: Tenneco Announces CEOs of 2019 Companies