Tenneco looks at business spin off, sales options

Aftermarket auto parts manufacturer Tenneco said it is reviewing plans to spin off its DRiV auto ride performance business, which could include selling off one or more of its divisions.

In a statement to shareholders released Monday, the Lake Forest-based Fortune 500 company said it has brought on global financial advisory firm Lazard to help the company review "strategic alternatives to maximize shareholder value." In addition to the planned spin off of DRiV and its powertrain technology business, to be called New Tenneco, officials said the company will consider the option of selling either or both companies.

"The company is implementing a plan to accelerate the reduction of operational costs, improve cash flow performance, reduce leverage, and better position DRiV and New Tenneco for the planned separation," company officials said in the statement.

Tenneco board chairman Gregg M. Sherrill added the addition of Lazard to its advisory team "will add a fresh perspective in our assessment of strategic alternatives."

The company announced the creation and spin off of its aftermarket and ride performance business, called DRiV, in early 2019, with Brian Kessler becoming its CEO. DRiV will include the company's brands of Monroe, Moog and Walker products, according to DRiV's website. New Tenneco will focus on its clear air and engine parts businesses.

Originally planned to happen in late 2019, the company announced earlier this month market conditions would push the split to mid-2020.

Tenneco also announced that Kessler would become Tenneco's new CEO as part of its streamlining plan, and co-CEO Roger Wood would be stepping down from the company.

The company added it currently remains committed to the spin off.