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Icahn Is Said to Eye $1.5 Billion in Possible Fel-Pro Sale

Icahn Is Said to Eye $1.5 Billion in Possible Fel-Pro Sale
(Michael Nagel/Getty Images)

Monday, 18 September 2017 03:09 PM

Carl Icahn’s Federal-Mogul Holdings LLC is considering a sale of its Fel-Pro engine parts business with a price tag of about $1.5 billion in mind, people familiar with the matter said.

Fel-Pro, which makes engine gaskets and sealants, has about $180 million in earnings before interest, taxes, depreciation and amortization, said the people, who asked not to be identified because the matter is private. Icahn is seeking about eight times Ebitda, which implies a desired sale price of about $1.5 billion, they said.

Icahn is working with XMS Capital Partners as an adviser on the sale process, one of the people said.

Representatives of Federal-Mogul and XMS didn’t respond to requests for comment.

If Icahn can get his price for Fel-Pro, it would boost his returns for Federal-Mogul, which he took private this year. Icahn acquired Federal-Mogul debt before its 2001 bankruptcy and later converted it to equity. He then bought the last of the shares he didn’t own and folded the company into Icahn Enterprises LP in January.

Federal-Mogul bought Fel-Pro for $720 million in 1998. It’s now part of Federal-Mogul’s Motorparts division, which includes Champion spark plugs, Anco windshield wipers and Wagner brakes. Federal-Mogul last year called off a plan announced in 2014 to spin off the Motorparts unit.

Icahn would have to fetch a good price for Fel-Pro to part with it, one of the people said. He has a growing presence in auto-parts retailing and believes he can get good value by owning after-market parts brands and selling the products in his own retail stores, the person said.

Icahn Automotive Group, a separate unit from the Motorparts division, acquired car-service chain Precision Auto Care Inc. in July. He has been adding more auto parts retail and service businesses, including buying Pep Boys for $1 billion last year.

With its Pep Boys and Auto Plus chains, Icahn Automotive has 1,200 stores and 20 distribution centers in the U.S., according to the company’s website.

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Carl Icahn's Federal-Mogul Holdings LLC is considering a sale of its Fel-Pro engine parts business with a price tag of about $1.5 billion in mind, people familiar with the matter said.
icahn, fel, pro, sale
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2017-09-18
Monday, 18 September 2017 03:09 PM
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