Federal-Mogul has issued a statement to dampen down media speculation this week that a deal on asbestos lawsuits is imminent and that as part of a deal the company would emerge from bankruptcy under a different ownership structure.

In response to reports Federal-Mogul Corporation issued the following statement:

"Federal-Mogul has not agreed to the terms of any plan of reorganisation that would permit it to emerge from Chapter 11.

"We continue to work diligently with all parties involved in our restructuring, and we remain optimistic that with our leadership a consensual resolution can and will be reached," said Frank Macher, chairman and chief executive officer.

"The Board of Directors and the management team remain in control of the company."