Icahn's Federal-Mogul Soars 31 on Profit, Gabelli Stake

Monday, 22 Jul 2013 05:19 PM

 

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Shares of Federal-Mogul Corp., the auto-parts maker controlled by billionaire Carl Icahn, surged the most in more than four years after the company returned to a profit in the second quarter and investor Mario Gabelli boosted his stake to more than 5 percent.

The shares climbed 31 percent to $13.95 at the close in New York, the biggest one-day gain since Oct. 30, 2008. The Southfield, Michigan-based company’s stock has increased 74 percent this year, compared with a 24 percent rise for the Russell 2000 Index. Federal-Mogul was the biggest gainer in the index today.

Icahn owns 81 percent of the maker of auto parts, including Anco wiper blades and Champion spark plugs. Federal-Mogul is closing factories, mostly in North America and Western Europe, and moving work to lower-cost locations such as Mexico, China and Poland by 2015.

Federal-Mogul reported before the start of regular trading that second-quarter net income totaled $56 million, or 57 cents a share, compared with a year-earlier loss of $59 million, or 60 cents. Revenue rose 5.8 percent to $1.77 billion from a year earlier.

Gabelli, in a regulatory filing just before the close, said he raised his stake to 7.52 million shares, or 5.01 percent. Gabelli held a 3.14 percent stake as of March 31, according to data compiled by Bloomberg.

The company also said Monday it completed a shareholder rights offering on July 9 that generated $500 million in proceeds.

© Copyright 2014 Bloomberg News. All rights reserved.

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