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S&P Affirms Federal-Mogul Ratings

19 August 1998

S&P Affirms Federal-Mogul Ratings; Outlook Stable; Re: Acquisition

    NEW YORK, Aug. 19 -- Standard & Poor's today affirmed its
ratings on Federal-Mogul Corp. and its unit, Federal-Mogul Financing Trust
(see list below).  The outlook is stable.
    About $1.3 billion in long-term debt securities and $575 million of
preferred stock are affected.  The affirmations follow the announcement that
Federal-Mogul has agreed to acquire Cooper Automotive, a unit of Cooper
Industries Inc., for $1.9 billion in cash.
    Cooper Automotive, with a sales split of 74% aftermarket and 26% original
equipment, provides a good strategic fit with Federal-Mogul, enhancing its
position as a leading automotive supplier with an approximate $7 billion
revenue base.  The firm will gain a number of well-known brand names that
enjoy a No. 1 or No. 2 leadership position, and it will become the world
leader in brake friction products.
    The deal will initially be funded with a bridge bank facility, but
Federal-Mogul has stated that it plans to quickly follow through with
permanent financing, including about $800 million of common equity.  The
ratings assume that the equity offering will be successful.
    The balance sheet will initially be very stretched, but is expected to be
restored over the next 12 to 18 months.  Free cash flow generation,
rationalization and integration benefits, proceeds from planned asset sales,
and the common equity offering should result in significant debt reduction.
Management is expected to use a mix of debt and equity to fund future
acquisitions.  Total debt to capital is expected to be in the mid-50% area by
the end of 1999.

    OUTLOOK: STABLE
    Current ratings assume that Federal-Mogul management will be successful
in integrating recent acquisitions and that it will remain committed to
achieving improved credit measures, Standard & Poor's said. -- CreditWire

    OUTSTANDING RATINGS AFFIRMED
                                                  Rating

    Federal Mogul Corp.
    Corporate credit rating                         BB+
    Senior unsecured debt                           BB+
    Senior unsecured debt (shelf registration)*     BB+
    Preferred stock (shelf registration)*           BB-

    Federal-Mogul Financing Trust
    Preferred stock**                               BB-
    *Preliminary rating
    **Guaranteed by Federal-Mogul Corp.