Federal-Mogul Corporation : FEDERAL-MOGUL ANNOUNCES PLAN TO LAUNCH $500
MILLION COMMON STOCK RIGHTS OFFERING
Equity Proceeds to Support Refinancing of Outstanding Debt
Southfield, Mich., May 28, 2013 ... Federal-Mogul Corporation (NASDAQ:FDML)
today announced that it intends to launch a registered rights offering on June
7, 2013 and pursue the refinancing of its outstanding indebtedness. In the
rights offering, each stockholder as of 5:00 p.m. Eastern Daylight Time on the
record date of June 7, 2013 will be issued, at no charge, one transferable
subscription right for each whole share of common stock owned by that
stockholder on the record date. As described below, a subsidiary of Icahn
Enterprises L.P., the Company's largest stockholder, has agreed to subscribe
for its pro rata share of the rights offering under its basic subscription
privilege and indicated its willingness to oversubscribe for additional shares
if necessary for a successful refinancing of the Company's outstanding
indebtedness, subject to availability and pro-rata allocation among other
rights holders who have elected to exercise their oversubscription rights.
Each subscription right will entitle a shareholder to purchase a number of
shares of the Company's common stock at a subscription price equal to $9.78
per share (subject to rounding down to avoid the issuance of fractional
shares) (the "basic subscription privilege"). The rights offering will also
include an over-subscription privilege, which will entitle stockholders who
exercise all of their subscription rights in the basic subscription privilege
the right to purchase additional shares of common stock in the rights
offering, subject to availability and pro rata allocation of shares among
rights holders exercising such over-subscription privilege.
The Company will offer a number of shares of its common stock in the rights
offering, inclusive of the over-subscription privilege, representing
approximately $500 million of gross proceeds. The Company plans to use the
proceeds from the rights offering to repay a portion of its outstanding
indebtedness under its existing credit facility and for general corporate
purposes, including, but not limited to, operational restructuring actions.
In connection with the rights offering, the Company announced that it entered
into an investment agreement with IEH FM Holdings LLC ("IEH"), a subsidiary of
Icahn Enterprises L.P., the Company's largest stockholder of record. IEH has
agreed, among other things, to exercise all of its subscription rights under
its basic subscription privilege in the rights offering pursuant to the terms
and conditions contained in that agreement.
The Company presently expects to begin distributing the subscription rights to
its stockholders under the rights offering as soon as practicable following
the record date. The rights offering will terminate at 5:00 p.m. Eastern
Daylight Time, on June 27, 2013, unless extended. Holders of subscription
rights must exercise their rights prior to that time and date if they intend
to participate in the rights offering.
The rights offering will be made pursuant to a shelf registration statement on
Form S-3 that was previously filed with the Securities and Exchange Commission
(the "SEC") and became effective on May 1, 2013. The rights offering will be
made solely by means of a prospectus and prospectus supplement meeting the
requirements of the Securities Act of 1933, as amended, to be filed with the
SEC. Additional information regarding the rights offering will be set forth
in the prospectus supplement to be filed with the SEC.
Federal-Mogul also announced today that it is pursuing a potential refinancing
of its outstanding indebtedness. The Company expects to complete its
refinancing plans shortly after the completion of the rights offering. The
refinancing transactions will be subject to various factors and conditions,
including market conditions. No assurances can be given that the transactions
will be completed.
This press release shall not constitute an offer to sell or the solicitation
of an offer to buy any securities, nor shall there be any offer, solicitation
or sale of securities in any state in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such state.
Federal-Mogul Corporation (NASDAQ: FDML) is a leading global supplier of
products and services to the world's manufacturers and servicers of vehicles
and equipment in the automotive, light, medium and heavy-duty commercial,
marine, rail, aerospace, power generation and industrial markets. The
company's products and services enable improved fuel economy, reduced
emissions and enhanced vehicle safety.
Federal-Mogul operates two independent business segments, each with a chief
executive officer reporting to Federal-Mogul's Board of Directors.
Federal-Mogul's Powertrain Segment designs and manufactures original equipment
powertrain components and systems protection products for automotive,
heavy-duty, industrial and transport applications.
Federal-Mogul's Vehicle Components Segment sells and distributes a broad
portfolio of products through more than 20 of the world's most recognized
brands in the global vehicle aftermarket, while also serving original
equipment vehicle manufacturers with products including braking, chassis,
wipers and other vehicle components. The company's aftermarket brands include
ANCO^® wiper blades; Champion^® spark plugs, wipers and filters; AE^®,
Fel-Pro^®, FP Diesel^®, Goetze^®, Glyco^®, Nüral^®, Payen^® and Sealed Power^®
engine products; MOOG^® steering and suspension parts; and Ferodo^® and
Wagner^® brake products. Federal-Mogul was founded in Detroit in 1899. The
company employs 45,000 people in 34 countries, and its worldwide headquarters
is in Southfield, Michigan, United States. For more information, please visit
Statements contained in this press release, which are not historical fact,
constitute "Forward-Looking Statements." Actual results may differ materially
due to numerous important factors that are described in Federal-Mogul's most
recent report to the SEC on Form 10-K, which may be revised or supplemented in
subsequent reports to the SEC on Forms 10-Q and 8-K. Such factors include,
among others, fluctuations in domestic or foreign vehicle production,
fluctuations in the demand for vehicles containing our products, the Company's
ability to generate cost savings or manufacturing efficiencies to offset or
exceed contractually or competitively required price reductions or price
reductions to obtain new business, conditions in the automotive industry, the
success of the company's segmentation and corresponding effects and general
global and regional economic conditions. Federal-Mogul does not intend or
assume any obligation to update any forward-looking statements.
CONTACT: Steve Gaut (248) 354-7826 for investor and media questions
This announcement is distributed by Thomson Reuters on behalf of Thomson
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other
applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of
information contained therein.
Source: Federal-Mogul Corporation via Thomson Reuters ONE
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