IBP/Tyson merger plans back on track
Following the court ruling, Tyson issued a press statement saying it had met with IBP executives and that both parties had agreed to work towards completing a merger on "financial terms identical to those previously agreed".
The Arkansas-based food company described the meeting as being "positive and productive", and that it did not intend to appeal against the ruling. It also said it was pleased that matters were "back on track".
Meanwhile, Moody’s, one of the US’s largest ratings agencies, said that it was reviewing Tyson’s rating, with a view to a possible downgrade. The proposed merger has never been seen as being a particularly good move for Tyson on Wall Street, to the extent that the company’s share prices increased when the merger talks were called off.
Sitting at Delaware Chancery Court, Judge Strine suggested that the companies should try to reach a solution before June 27, and warned that Tyson could face "huge" damages if a deal did not proceed. Despite the upbeat tone of Tyson’s press statements, some analysts believe that the company is still not 100% committed and would prefer instead to buy itself out from the deal.
