The preliminary allocation of the purchase price of the assets acquired and liabilities assumed, including the residual amount recognized as goodwill, is based upon estimated information and is subject to change within the measurement period. The measurement period is a period not to exceed one year from the acquisition date during which the Company may adjust estimated or provisional amounts recorded during purchase accounting if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have resulted in revised estimated values of those assets or liabilities as of that date. Any adjustments to amounts recorded in purchase accounting that do not qualify as measurement period adjustments are included in earnings in the period identified.

The fair values of the assets acquired and liabilities assumed are based on preliminary estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques.

While the Company believes these preliminary estimates provide a reasonable basis for estimating the fair value of the assets acquired and liabilities assumed, it will continue to evaluate available information prior to finalization of the amounts.

The purchase price for the 90.5% ownership interest in Öhlins was $162 million. The remaining 9.5% ownership interest in Öhlins (the “KÖ Interest”) was retained by K Öhlin Holding AB (“Köhlin”). Köhlin has an irrevocable right at any time after the third anniversary of the Öhlins Acquisition to sell the KÖ Interest to the Company. As the redemption of this redeemable noncontrolling interest is not solely within the Company's control, the noncontrolling interest is presented in the temporary equity section of the Company's condensed consolidated balance sheets. The fair value of the KÖ Interest was $17 million and represents its current redemption value at September 30, 2019.



	Initial Allocation		Adjustments			Revised Allocation
Cash, cash equivalents and restricted cash	$	4	$	—		$	4
Customer notes and accounts receivable	19		—			19
Inventories	31		—			31
Prepayments and other current assets	2		—			2
Property, plant, and equipment	8		—			8
Goodwill	28		2			30
Intangibles	135		(2		)	133
Other assets	9		—			9
Total assets acquired	236		—			236

Short-term debt, including current maturities of long-term debt	10		—			10
Accounts payable	11		—			11
Accrued compensation and employee benefits	12		—			12
Deferred income taxes	18		—			18
Deferred credits and other liabilities	6		—			6
Total liabilities assumed	57		—			57
Redeemable noncontrolling interest	17		—			17
Net assets acquired	$	162	$	—		$	162

Goodwill of $30 million was recognized as part of the acquisition and is reflected in the Ride Performance segment. During the nine months ended September 30, 2019, the Company adjusted the initial allocation of the total purchase consideration, which resulted in a $2 million increase to goodwill. The goodwill consists of the Company’s expected future economic benefits that will result from the acquisition of Öhlins’ technology, which will allow the Company to more rapidly grow its product offerings for current and future customers, as well as assist the Company in obtaining a larger share of business in developing mobility markets. None of the goodwill is deductible for tax purposes.



	Estimated Fair Value		Weighted-Average Useful Lives
Definite-lived intangible assets:
Customer platforms and relationships	$	37	10 years
Technology rights	41		10 years
Total definite-lived intangible assets	78

Indefinite-lived intangible assets:
Trade names and trademarks	55
Total	$	133

The Company recorded a $5 million step-up of inventory to its fair value as of the acquisition date based on the preliminary valuation and recognized $5 million as a non-cash charge to cost of goods sold during the nine months ended September 30, 2019 related to the amortization of this step-up, as the acquired inventory was sold.

The Company finalized the valuation of the assets and liabilities of the Federal-Mogul Acquisition during the third quarter of 2019. During the nine months ended September 30, 2019, the Company made measurement period adjustments based on further evaluation of available information to facts and circumstances that existed as of the acquisition date.



	Initial Allocation		Adjustments			Final Allocation
Cash, cash equivalents and restricted cash	$	277	$	—		$	277
Customer notes and accounts receivable	1,258		(4		)	1,254
Other receivables	62		—			62
Inventories	1,551		(8		)	1,543
Prepayments and other current assets	198		—			198
Property, plant and equipment	1,711		(28		)	1,683
Long-term receivables	48		—			48
Goodwill	825		(22		)	803
Intangibles	1,530		47			1,577
Investments in nonconsolidated affiliates	528		(4		)	524
Deferred income taxes	166		30			196
Other assets	55		(5		)	50
Total assets acquired	8,209		6			8,215

Short-term debt, including current maturities of long-term debt	130		—			130
Accounts payable	957		4			961
Accrued compensation and employee benefits	231		—			231
Accrued income taxes	49		—			49
Accrued expenses and other current liabilities	522		(7		)	515
Long-term debt	1,315		—			1,315
Deferred income taxes	56		24			80
Pension and postretirement benefits	879		—			879
Deferred credits and other liabilities	124		(5		)	119
Total liabilities assumed	4,263		16			4,279
Redeemable noncontrolling interests	96		(8		)	88
Noncontrolling interests	143		(2		)	141
Net assets and noncontrolling interests acquired	$	3,707	$	—		$	3,707

Goodwill of $343 million was allocated to the Powertrain segment, $395 million was allocated to the Motorparts segment, and $65 million was allocated to the Ride Performance segment. The goodwill consists of the Company's expected future economic benefits that will arise from expected future product sales and synergies from combining Federal-Mogul with its existing portfolio of products. None of the goodwill is deductible for tax purposes.



	Estimated Fair Value		Weighted-Average Useful Lives
Definite-lived intangible assets:
Customer platforms and relationships	$	953	10 years
Technology rights	66		10 years
Packaged kits know-how	54		10 years
Catalogs	47		10 years
Licensing agreements	64		4.5 years
Land use rights	30		42.8 years
Total definite-lived intangible assets	1,214		10.5 years

Indefinite-lived intangible assets:
Trade names and trademarks	363
Total	$	1,577

The Company recorded a $149 million step-up of inventory to its fair value as of the acquisition date. The Company recognized $44 million as a non-cash charge to cost of goods sold during the nine months ended September 30, 2019 related to the amortization of this step-up, as the acquired inventory was sold. The Company recognized $105 million as a non-cash charge to cost of goods sold during the year ended December 31, 2018. As of September 30, 2019, there is no remaining inventory step-up to be amortized.

In addition, the Company acquired $81 million in redeemable noncontrolling interests related to a subsidiary from the Federal-Mogul Acquisition. The Company initiated the process to make a tender offer for the shares it does not own due to the change in control in accordance with local regulations triggered by the acquisition. It is probable these shares will become redeemable within the next year under the tender offer at a price that is representative of fair value and as a result, the noncontrolling interest is presented in the temporary equity section of the Company’s condensed consolidated balance sheets. The carrying amount for this redeemable noncontrolling interest represents its current redemption value at September 30, 2019.

The Company's condensed consolidated statements of income (loss) for the nine months ended September 30, 2019 included net sales and operating revenues of $5,537 million and net loss of $34 million associated with the operating results of Federal-Mogul.

The following table summarizes, on a pro forma basis, the combined results of operations of the Company and the Federal-Mogul Acquisition, and the related financing, if the transaction had occurred as of January 1, 2017. The pro forma results are not necessarily indicative of either the actual consolidated results had the Federal-Mogul Acquisition occurred on January 1, 2017 or of future consolidated operating results.



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Net sales and operating revenues	$	4,319	$	4,283	$	13,307	$	13,581
Earnings (loss) before income taxes and noncontrolling interests	$	168	$	287	$	369	$	745
Net income (loss) attributable to Tenneco Inc.	$	84	$	142	$	57	$	313
Basic earnings (loss) per share of common stock	$	1.03	$	1.75	$	0.70	$	3.88
Diluted earnings (loss) per share of common stock	$	1.03	$	1.75	$	0.70	$	3.87

These pro forma amounts have been calculated after applying the Company's accounting policies and the results presented above primarily reflect: (i) depreciation adjustments relating to fair value adjustments to property, plant, and equipment; (ii) amortization adjustments relating to fair value estimates of intangible assets; (iii) incremental interest expense, net on assumed

indebtedness, the new credit facility, debt issuance costs, and fair value adjustments to debt; and (iv) cost of goods sold adjustments relating to fair value adjustments to inventory. Pro forma adjustments described above have been tax affected using the Company's effective rate during the respective periods.

On March 1, 2019, the Company sold its wipers business in the Motorparts segment for a sale price of $29 million, subject to adjustment based on terms of the sale agreement. Proceeds from the sale were $22 million, subject to customary working capital adjustments. Certain assets and liabilities of the business are still classified as held for sale within the condensed consolidated balance sheet as of September 30, 2019 and were transferred to the buyer on October 1, 2019.

In August 2019, the Company executed a letter of intent to sell a non-core business in the Motorparts segment for a sale price of $24 million, subject to adjustment, as the Company continues to rationalize its product portfolio and focus on core product lines. As of September 30, 2019, proceeds from the sale would have been $24 million. The related assets and liabilities were classified as held for sale as of September 30, 2019. The transaction is expected to close within the next year.



	September 30, 2019			December 31, 2018
Assets
Receivables	$	8		$	—
Inventories	7			33
Other current assets	3			5
Long-lived assets	16			23
Goodwill	4			—
Impairment on carrying value	(8		)	—
Total assets held for sale	$	30		$	61
Liabilities
Accounts payable	$	4		$	21
Accrued liabilities	—			7
Other liabilities	1			11
Total liabilities held for sale	$	5		$	39