Federal-Mogul Holdings Corp (NASDAQ:FDML) announced on Wednesday, September 2nd that it will separate its powertrain and motorparts divisions into two independent companies. The iconic 115-year old firm plans to spin off the Motorparts division to its shareholders. The spinoff should be finalized in the first half of 2015.

Federal-Mogul Corporation FDML

The firm emphasized that the independent Motorparts company (with brands such as ANCO wiper blades and Champion spark plugs) will have significantly greater financial and operational flexibility. A separation into two business entities will also give the Powertrain division to explore opportunities to increase its footprint in the sector.

Statement from Federal-Mogul Chairman Carl Icahn

Carl Icahn, activist investor and chairman of Federal-Mogul’s board, commented on the plan.to divide the company. “By separating the Powertrain and Motorparts divisions of Federal-Mogul we are creating two independent, market-leading companies that will be among the largest and strongest in their respective peer groups globally,” he said.

Icahn continued to say the new Federal-Mogul Motorparts will have strong finances with access to large amounts of capital, while the remaining Federal-Mogul Powertrain business will benefit from an “enhanced management focus”.

He also noted that, “Upon separation both businesses will be well-capitalized and poised for stand-alone success.” Of note, Icahn is a majority stakeholder in Federal-Mogul Holdings Corp (NASDAQ:FDML), owning just over 81% of the total company float.

More on Federal-Mogul Powertrain

The statement released by the company explained that Federal-Mogul Powertrain will design and make components for automakers in order to improve fuel economy, reduce emissions and enhance vehicle performance. The new company will be looking for expansion opportunities.

Federal-Mogul Holdings Corp (NASDAQ:FDML) is trading up 40 cents at $17.66 (2.32%) as of 11:40 AM ET today.