Federal-Mogul Corp., Southfield, Mich., has filed for financial restructuring under Chapter 11 of the U.S. bankruptcy code, "to separate its asbestos liabilities from its true operating potential."
In addition, Federal-Mogul subsidiaries in the United Kingdom have filed jointly for Chapter 11 and Administration under the U.K. Insolvency Act of 1986.
The filings give Federal-Mogul a chance to develop a plan to resolve its asbestos liabilities. During the restructuring, Federal-Mogul will continue business operations without interruption.
Federal-Mogul intends to work closely with asbestos claimants and other creditors to develop a financial reorganization plan that will address asbestos claims and establish a viable capital structure for the long-term growth and profitability of the company's operations.
"After vigorously working for a legislative solution and operating nine months with our new litigation approach for managing asbestos claims, we have determined that the Chapter 11 and Administration processes are the only way we can effectively structure payments for claimants without financially crippling the operations of Federal-Mogul," said Frank Macher, chairman and CEO.
No Federal-Mogul job losses or facility closures are expected as a direct result of the filings.
Federal-Mogul is one of more than 30 companies involved in asbestos-related litigation to voluntarily file for Chapter 11 since 1982. Ten companies involved in asbestos-related litigation have filed since January 1, 2000.
The company also announced it has made Macher chairman and chief executive officer, adding the responsibilities of chairman to his previous role as CEO, effective Oct. 1. Macher, 60, replaces Robert S. (Steve) Miller Jr., who had been serving as non-executive chairman and who will remain on Federal-Mogul's board of directors.
The board's action accelerates a leadership succession plan at Federal-Mogul that was announced at the time of Macher's appointment on January 11, 2001. The acceleration resulted from the recent appointment of Miller as chairman and CEO of Bethlehem Steel Corp., effective Sept. 24.
Chip McClure remains as Federal-Mogul's president and chief operating officer, a position he has held since January 11, 2001.
In addition, Federal-Mogul subsidiaries in the United Kingdom have filed jointly for Chapter 11 and Administration under the U.K. Insolvency Act of 1986.
The filings give Federal-Mogul a chance to develop a plan to resolve its asbestos liabilities. During the restructuring, Federal-Mogul will continue business operations without interruption.
Federal-Mogul intends to work closely with asbestos claimants and other creditors to develop a financial reorganization plan that will address asbestos claims and establish a viable capital structure for the long-term growth and profitability of the company's operations.
"After vigorously working for a legislative solution and operating nine months with our new litigation approach for managing asbestos claims, we have determined that the Chapter 11 and Administration processes are the only way we can effectively structure payments for claimants without financially crippling the operations of Federal-Mogul," said Frank Macher, chairman and CEO.
No Federal-Mogul job losses or facility closures are expected as a direct result of the filings.
Federal-Mogul is one of more than 30 companies involved in asbestos-related litigation to voluntarily file for Chapter 11 since 1982. Ten companies involved in asbestos-related litigation have filed since January 1, 2000.
The company also announced it has made Macher chairman and chief executive officer, adding the responsibilities of chairman to his previous role as CEO, effective Oct. 1. Macher, 60, replaces Robert S. (Steve) Miller Jr., who had been serving as non-executive chairman and who will remain on Federal-Mogul's board of directors.
The board's action accelerates a leadership succession plan at Federal-Mogul that was announced at the time of Macher's appointment on January 11, 2001. The acceleration resulted from the recent appointment of Miller as chairman and CEO of Bethlehem Steel Corp., effective Sept. 24.
Chip McClure remains as Federal-Mogul's president and chief operating officer, a position he has held since January 11, 2001.
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