MENLO PARK, California (AP/Reuters) -- Tyco International Ltd. plans to buy Raychem Corp., a designer, manufacturer and distributor of electronic components, for about $2.87 billion in cash and stock.

Tyco International is a diversified manufacturing and service company and said Raychem would complement its electronic components business under the deal announced yesterday.

Raychem, which had 1998 revenue of $1.8 billion, would merge with a subsidiary of Bermuda-based Tyco, which expects to have more than $22 billion in revenue this year.

The boards of both companies have unanimously approved the transaction.

Raychem shareholders would get about $37 a share for their stock under terms of the deal. That includes about $1.4 billion in cash and 16.1 million newly issued Tyco shares.

"Raychem is an excellent strategic fit with our Electronics business and will be immediately accretive to Tyco's earnings,'' Tyco chairman and chief executive L. Dennis Kozlowski said.

He said Raychem's products, international presence, and customers are all highly complementary with Tyco's, particularly those of Tyco's AMP subsidiary.

The acquisition, he said, would give Tyco opportunities to cut costs and boost growth through an expanded product line, new customers and marketing efficiencies.

Once it owns Raychem, Tyco will have about $9.3 billion in electronics sales and a leading position selling electronics to the telecommunications, automotive and other industries, Kozlowski said.

Richard A. Kashnow, chairman and chief executive of Raychem, said the deal will "result in an expanded set of offerings for our customers'' and enable both companies to grow faster.

Tyco operates in more than 80 countries around the world.

It is a leader in making fire protection systems and providing electronic security services. It also makes and services electrical and electronic components and underwater telecommunications systems and makes flow control valves, disposable medical products and plastics and adhesives.

Separately, the Spanish telecommunications company Telefonica SA said yesterday it has sold its underwater-cable unit, Temasa, to a unit of Tyco International for about $280 million.

Temasa specialises in installing and maintaining fibre-optic cables on the ocean floor. The Tyco unit, Tyco Submarine Systems Ltd., specialises in servicing underwater cables.

Spain's former telecommunications monopoly said the deal strengthens its links with Tyco. Last week, the companies signed a $900 million project to link South America, Central America and the US through a network of underwater cables.

The system, comprising 23,000 kilometers (14,000 miles) of undersea cable, will combine with Telefonica's land-based network in Latin America to connect the United States, Puerto Rico, Guatemala, Brazil and Argentina on the Atlantic coast with Chile, Peru, Colombia and Guatemala along the west coast of South America, Tyco said.

The first phase is expected to be operational in December 2000, while the full system is anticipated to be operational by July 2001.

Tyco, an industrial goods maker registered in Bermuda, said the companies will form a joint venture that will be 75 percent-owned and managed by Telefonica, Spain's largest telephone company.

The supply contract for the system will have a value of about $900 million and has been awarded to Tyco's Tyco Submarine Systems unit.