Federal Mogul—an entity of activist investor Carl Icahn’s Icahn Enterprises which operates a facility in Manitowoc—has been sold to auto parts maker Tenneco in a deal worth $5.4 billion. Tenneco will then separate the combined wiper blade and spark plug companies into two separate stocks in a tax-free spin-off. One will focus on aftermarket and ride-performance and the other on powertrain technology.

George Reis is President of GVR Investment Management in Two Rivers.

Reis on a potential negative or uncertainty of this transaction.

Icahn acquired control of Federal Mogul in 2008 and took it private last year.  Reis admits he’s somewhat surprised that Icahn held onto Federal Mogul “so long” (nine years). The local financial expert adds “a lot can happen between now and closing of the sale.”

The transaction is to net Icahn $800 million in cash plus 29 and-a-half million shares of Tenneco stock and is expected to be finalized in the second half of 2018.