IBP Says Tyson Had No Right to End Merger

IBP (IBP Quote) said Friday that it was "shocked" by yesterday's decision by Tyson Foods (TSN Quote) to pull out of the proposed $3.2 billion merger of the companies.

On Thursday, Tyson called off the merger with IBP and said it was "inappropriately induced" to enter a deal with the beef and pork processor.

"We do not believe Tyson has any valid basis to discontinue or terminate the merger agreement between the two companies," IBP said. The company also said it resolved its issues with the SEC, which have tainted the merger almost from the start.

Tyson said yesterday it began legal action in Arkansas, where it is based, and is seeking compensation from IBP.

IBP said it hasn't yet seen the complaint. "We can tell you we at IBP will take all appropriate steps to protect the rights of our company and our shareholders," the company added.