Federal-Mogul Secures Additional Credit

Auto parts maker Federal-Mogul Corp. said it secured $550 million in additional credit to buy itself time to address an estimated $900 million in asbestos claims over the next four years. The Southfield, Mich.-based maker of Champion sparkplugs, Wagner brakes and other auto parts said it added a $200-million credit line and a $150-million loan to an amended $1.7-billion credit facility. Federal-Mogul said it also gained about $200 million in European financing. The company, which has suffered a series of downgrades by top credit rating agencies in recent months, was upbeat during a meeting with analysts in New York, promising the additional credit will allow it to recover as it works through asbestos litigation. Many companies, including Owens Corning in October and Armstrong Holdings Inc. in December, have filed for bankruptcy protection to manage asbestos liability. Federal-Mogul shares, which have plunged 79% over the last 12 months amid solvency concerns, rose 75 cents to close at $3.81 on the NYSE.