Significant erosion in Tyco International Ltd.'s (A/Stable/A-1) share price and reports of widening bond spreads during the past few days have highlighted the question of Tyco International's future credit quality. As long as the company maintains financial flexibility, an important part of which is the company's ability to extend the maturity of its short-term bank line, Standard&Poor's would discount these concerns. The stock and bond markets appear to be reacting to investor uncertainty regarding accounting practices, corporate ethics, and the company's plan to split into four independent companies. Questions regarding the company's accounting practices have been answered to Standard&Poor's satisfaction. The recently disclosed payment to a corporate director in connection with the acquisition of The CIT
