Tyco International Limited, the US-based manufacturing and services group, is heading towards a confrontation with investors holding its bonds as it seeks to buy back the securities at a lower price than expected, according to analysts.

Tyco International said last Friday it aimed to buy back most of its $6.6bn (€9bn) outstanding dollar-denominated public debt, and that subsidiary Tyco International Group would tender for all of its outstanding euro and sterling denominated debt, worth about $1.9bn equivalent.