The acquired company that helped put Federal-Mogul Corp. into bankruptcy is delaying its exit from Chapter 11.
A dispute over T&N P.L.C.'s underfunded pension plan in Great Britain delayed Federal-Mogul's confirmation hearing on its reorganization plan in December in U.S. Bankruptcy Court in Delaware.
No new date has been scheduled.
Federal-Mogul, a global supplier of automotive parts, equipment and systems, spent $66.8 million last year on Chapter 11 expenses, according to its third quarter statement.
Federal-Mogul is in administration in Great Britain, a process similar to bankruptcy.
The reorganization plan calls for asbestos claimants to own 50.1 percent of the new Federal-Mogul's stock and bondholders to own 49 percent.
The company filed its Chapter 11 petition in October 2001, in part because of asbestos liabilities it acquired when it bought T&N in 1998.
T&N faces a $1.7 billion shortfall in its pension plan. Federal-Mogul and its creditors first proposed a one-time $130 million payment.
The fund's trustees rejected that plan.
The company and its creditors upped the offer to $25 million a year for the first three years and promised to ensure the plan's full funding within a decade.
One of the company's main creditors is financier Carl Icahn, who holds the largest amount of Federal-Mogul's bond debt.
But the new offer has been withdrawn.
Federal-Mogul said uncertainty over a new pension law passed by the British Parliament was the main reason.
``That added a new layer of complexity to a situation already complex,'' said Marie Remboulis, director of corporate communications.
The company will keep trying to reach an agreement, she said.
Finalizing agreements in Great Britain is critical for Federal-Mogul's bankruptcy exit because the company said it needs to finish its British administration and U.S. bankruptcy at the same time.
One bankruptcy attorney not involved in the case said that's because it would be hard for Federal-Mogul to do intercompany transfers and repatriate funds if its British assets were still in administration and its U.S. assets were out of bankruptcy.
``You want to emerge as a restructured company globally,'' said Joel Applebaum, of counsel at Detroit law firm Pepper Hamilton P.L.L.C. ``You can't do it in bits and pieces.''
Federal-Mogul's aftermarket products include engine components, gaskets, anti-friction bearings and seals, brakes, chassis, wipers, fuel pumps, ignition and lighting. It has 130 manufacturing facilities in 29 countries.