NEW YORK (Bloomberg) — Bermuda-based Tyco International Ltd. said AIG Global Investment Corp. withdrew its lawsuit over the company's bond tender offer. A lawyer for AIG said they plan to refile.American International Group Inc.'s investment management unit sued Tyco to block it from buying back $6.6 billion of debt as part of a plan to split into three companies because the offer is $95 million less than what investors say they are entitled to under the indentures governing the bonds. Tyco has said it is paying market rates.

Andrew Rosenberg, the New York lawyer who represents AIG and other Tyco bondholders, said in an interview yesterday he will refile the suit, possibly in a state court rather than before a federal judge. The trustee for the bonds or more bondholders may be added to AIG as a plaintiff, he said.

"This is anything but over," Rosenberg said.

The deadline for holders to tender their bonds remains 5 p.m. New York time today, Tyco said in a statement yesterday.

AIG dropped the lawsuit after it lost its jurisdiction in federal court, Rosenberg said. Originally, AIG alleged that Tyco failed to disclose to bondholders the existence of a 1982 federal court ruling that AIG says bolsters its legal basis for opposing the tender, which would be a violation of a federal securities law.

In a later filing, Tyco acknowledged the lawsuit, so AIG needed to sue in another jurisdiction, Rosenberg said.