The drama ends, and begins, for Federal-Mogul

Six years after crushing debt drove it into bankruptcy reorganization, Federal-Mogul is poised to come out of Chapter 11 this week. And new drama — in the form of a key private-equity player — may lie ahead.

According to published reports, billionaire investor and supplier-swallower Carl Icahn paid about $775 million to acquire Federal-Mogul debt that he could choose to convert to 43 percent of the company's equity. That would make him captain of the ship.

Icahn isn't talking about his plans. But he has built his fortune and reputation by rebuilding and then selling troubled companies.

Icahn's arrival is just the latest chapter in Federal-Mogul's long, checkered history. The trouble began in the late 1990s, when CEO Richard Snell set what he called his "BHAG," for "big, hairy audacious goal" of reaching $10 billion in annual sales, up from about $2 billion at the time. The problem: Two of his buyouts were companies that built products from asbestos.

The combined weight of acquisition debt and billions of dollars in liabilities from asbestos-related lawsuits pushed the company into Chapter 11 in 2001.

What will Icahn do with his Detroit icon? Stay tuned.