Story first appeared in Bloomberg News.
Federal-Mogul Corp., the auto-parts supplier controlled by billionaire Carl Icahn, said it’s focused on growth and is evaluating acquisitions four months after considering putting itself up for sale.
Federal-Mogul is looking at purchases and is able to spend as much as
$1.6 billion, which would include the company’s $1 billion in cash and its $600 million credit line, Chief Executive Officer Jose Maria Alapont said today.
Alapont said that despite the recovery of the global economy, which now is challenged again, there are companies and businesses that are available for the people who have liquidity. The parts maker is looking at two companies, he said, declining to identify them.
Federal-Mogul’s second-quarter net income rose 31 percent to $64 million, or 64 cents a share, from $49 million, or 49 cents, a year earlier, the Southfield, Michigan-based company said today in a statement.
Federal-Mogul rose 18 cents to $19.81 at 4 p.m. in Nasdaq Stock Market composite trading. The shares have fallen 4.1 percent this year.
Revenue rose 13 percent to $1.8 billion, helped by a gain of about 23 percent in sales to vehicle makers, Alapont said. Sales of Federal- Mogul’s after-market unit, which sells replacement parts under brand names such as Champion, fell 3 percent.
The company’s U.S. sales to automakers rose 13 percent while U.S.
after-market sales slid 12 percent, Alapont said.
The portion of sales spent on selling, general and administrative expenses fell 1 percentage point to 9.6 percent, the company said.
The company said it is mostly focused on growth and won’t rule out strategic opportunities that may present themselves. Federal- Mogul said in March it hired Lazard Ltd. to evaluate strategic alternatives.
Icahn controlled 76 percent of Federal-Mogul’s shares as of April 1.
