Federal-Mogul set to resolve US liabilities

Federal-Mogul, the global parts supplier, has taken a further step to rebuild its business with a major restructure that should see it emerge from Chapter 11 by June next year.

The aftermarket giant was forced to file for protection under US Chapter 11 and UK bankruptcy procedures. This allowed it to resolve its multi-million dollar asbestos liabilities incurred after the acquisition of British firm Turner and Newall and its American subsidiaries in 1998.

Now Chip McClure, chief executive officer and president of Federal-Mogul, says the company has reached a deal with its claimants, lenders and creditors that will allow it to come out of Chapter 11 in 2004.

Robin Shaw, managing director of Federal-Mogul Aftermarket UK, says this is good news for retailers. “We expect the company to be stronger than it ever was,” he says.