XMS Capital Partners Serves as Exclusive Financial Advisor to Icahn Enterprises on the Sale of Federal-Mogul to Tenneco for $5.4 Billion
April 10, 2018
Chicago, Illinois, April 10, 2018 — XMS Capital Partners, LLC (“XMS”), a global, independent financial services firm focused on providing M&A, corporate advisory and asset management services, announced that it served as the exclusive financial advisor to Icahn Enterprises L.P. (NASDAQ:IEP) (“Icahn Enterprises”) on the agreement to sell Icahn Enterprises’ indirect wholly owned subsidiary Federal-Mogul LLC (“Federal-Mogul”) to Tenneco Inc. (NYSE:TEN) (“Tenneco”) for $5.4 billion.
The $5.4 billion enterprise value is comprised of $800 million in cash and 29.5 million shares of Tenneco common stock, of which 23.8 million shares will be non-voting shares that will convert to voting shares if and when sold. There will be restrictions on how much Tenneco stock can be sold within the first 150 days after the closing. Under the agreement, Tenneco can reduce the amount of non-voting common stock by up to 7.3 million shares and increase the cash consideration proportionately at the closing. The voting and nonvoting shares of Tenneco common stock will have the same economic value. Tenneco will also assume all debt of Federal-Mogul.
In connection with the sale, Tenneco announced its intention to separate the combined businesses into two independent, publicly traded companies through a taxfree spin-off to its stockholders that will establish an aftermarket & ride performance company and a powertrain technology company.
The sale is expected to close in the second half of 2018, subject to regulatory approvals, approval by Tenneco stockholders and other customary closing conditions, with the separation anticipated to occur in the second half of 2019. The sale is not subject to any financing condition.
Carl C. Icahn, Chairman of Icahn Enterprises, stated: “Icahn Enterprises acquired majority control of Federal-Mogul in 2008 when we saw an out-of-favor 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. This transaction is an excellent example of our general modus operandi at Icahn Enterprises, by which we seek to acquire undervalued assets, nurture, guide and improve their condition and operations, and ultimately develop them into more valuable businesses, which greatly enhances value for all shareholders.”
Brian Kesseler, CEO of Tenneco, stated: “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. Federal-Mogul brings strong brands, products and capabilities that are complementary to Tenneco’s portfolio and in line with our successful growth strategies. Unleashing two new product-focused companies with even stronger portfolios will allow them to move faster in executing on their specific growth priorities.”
For the complete news release, please use the following link:
About XMS Capital Partners
XMS Capital Partners, established in 2006, is a global, independent financial services firm providing M&A, corporate advisory and asset management services to clients. It has offices in Chicago, London and Dublin.
XMS provides Involvement BankingTM, which goes beyond transaction oriented investment banking and focuses on delivering objective, value added advice and custom tailored solutions to help clients achieve their strategic goals. It consistently creates value for its clients by giving them access to comprehensive, independent M&A, strategic advisory, financial restructuring, capital structure advisory and private capital advisory expertise.
All XMS engagements are led by senior investment bankers who average over 25 years of industry experience. Importantly, the combination of their extensive experience, technical expertise and “client first” orientation has served as a solid foundation of the firm since its formation in 2006. XMS Capital Partners, LLC is a FINRA member and SIPC member. For more information, please visit www.xmscapital.com.
About Icahn Enterprises
Icahn Enterprises L.P. (NASDAQ: IEP), a master limited partnership, is a diversified holding company engaged in ten primary business segments: Investment, Automotive, Energy, Gaming, Railcar, Mining, Food Packaging, Metals, Real Estate and Home Fashion.
Federal-Mogul, with revenue of $7.4 billion, operates two independent divisions with its headquarters in Southfield, Michigan and nearly 55,000 employees worldwide. Federal-Mogul Powertrain designs and manufactures original equipment powertrain components and systems protection products for automotive, heavyduty, industrial and transport applications. Federal-Mogul Motorparts sells and distributes a broad portfolio of products under many of the most recognized brands in the global vehicle aftermarket, while also serving original equipment vehicle manufacturers with products including braking, wipers and a range of chassis components. The company’s aftermarket brands include ANCO®, Beck/Arnley®, BERU®*, Champion®, Interfil®, AE®, Fel-Pro®, FP Diesel®, Goetze®, Glyco®, National®, Nüral®, Payen®, Sealed Power® and Speed-Pro® engine products; MOOG®; and Abex®, Ferodo®, Jurid® and Wagner® brake products and lighting.
Tenneco is a $9.3 billion global manufacturing company with headquarters in Lake Forest, Illinois and approximately 32,000 employees worldwide. Tenneco is one of the world’s largest designers, manufacturers and marketers of ride performance and clean air products and systems for automotive and commercial vehicle original equipment markets and the aftermarket. Tenneco’s principal brand names are Monroe®, Walker®, XNOx™ and Clevite®Elastomer.
Hank Hakewill, Hakewill & Associates
Phone: 847-256-5420 (office); 847-714-6561 (cell)