A $50 million piece of Federal-Mogul's bank debt changed hands almost two weeks ago in the 47-49 context, and small pieces of the paper continued to trade in the 48-52 context last week. Comerica is believed to have sold the large piece, while Bank of Tokyo-Mitsubishi was rumored to be unloading some exposure. The recent activity was prompted not only by regulatory pressures but by fears that issues affecting Ford Motor and General Motors could trickle down to car-part producers such as Federal-Mogul, according to sources.
Federal-Mogul is continuing to struggle through a bankruptcy process, which has been complicated by asbestos litigation and a bank holder versus bondholder collateral dispute. The Southfield, Mich., company recently filed a request to extend its deadline to file a plan of reorganization by four months to March 2003. "There have been negotiations on a plan, but we have asked for an extension on those plans," said James O'Neill, an attorney with Pachulski, Stang, Ziehl, Young & Jones, one of the firms representing Federal-Mogul. The extension request will be ruled upon on Oct. 30, he noted, adding that there have been no objections so far. Calls to Michael Lynch, cfo, were referred to a spokeswoman, who could not be reached by press time.