Tyco International (NYSE:TYC) plans to buy Brink's Home Security Holdings Inc (NYSE:CFL). The company has agreed to pay US$2 billion for the latter.

The acquisition marks the first major deal for Tyco in recent years after the company was split into four separate entities in 2002. The move will mark Tyco’s strength in the security business and consolidation in residential markets. Tyco’s ADT security franchise already commands around 22 percent in the North American residential and small business security market. The acquisition of Brink's Home Security will improve the market share to 26 percent. Despite its market leading position, the company is cautious in acquiring its competitors. Tyco doesn’t plan to undertake another big acquisition.

Prudent financial policies after the split of businesses are paying off now. Standard & Poor’s Rating Services has put the company’s ratings on watch for upgrade. Citing the credit measures which remained strong during the economic downturn last year, the ratings firm expects credit measures to remain same. Tyco’s acquisition of Brink's Home Security is not going to affect the credit rating as the company is using a combination of cash and stock.

The firm has a current rating of BBB+ which is likely to be changed in next 90 days. Tyco has also upped its first quarter forecast for the next year. The stock has gained nearly 7 percent in the past 30 months with high volumes.