Tyco Made Unreported Loan of $14.1 Million

Tyco International Ltd. Chief Executive Dennis Kozlowski and Chief Financial Officer Mark Swartz lent $14.1 million in 2000 to Warren Musser, a board member of former affiliate TyCom Ltd., the company said.

The loan, which has been repaid, was not reported publicly by Tyco because disclosure was “neither necessary nor was it required,” said Brad McGee, Tyco’s chief strategy officer.

Musser was a board member of TyCom, the largest maker of undersea cable, when Tyco offered to buy the 11% of the company it didn’t own for $748 million in October 2001. Tyco reached a definitive agreement with the affiliate 15 days later.

Shareholders filed lawsuits claiming that the pace at which the transaction was completed indicated the companies didn’t negotiate in good faith. Tyco, based in Bermuda and run from Exeter, N.H., has said the lawsuits are without merit.

Musser wasn’t a member of a special committee of TyCom directors that reviewed the Tyco offer, McGee said. He repaid the loan, made in December 2000, a year later.

Musser didn’t respond to a request for comment.