Boston, MA 05\/09\/2014 (wallstreetpr) \u2013 \u00a0Tower Group International, Ltd (NASDAQ:TWGP)<\/b> shares are plummeting in early morning trading session by a high of 4.43% after announcing it had entered into an amendment agreement with ACP Re Ltd. The new agreement now sees a reduction in per share consideration to be received by the company\u2019s shareholders from $3 per share to $2.50 per share.<\/p>\n
Amendment Terms<\/b><\/p>\n
The termination fee that Tower Group would be required to pay in the event of early termination of the agreement has also been reduced as part of the amendments. The amendments extend the deadline date to which Tower Group\u2019s shareholders must hold a meeting to vote on the merger agreement to November 15, 2014.<\/p>\n
The revised amendment excludes from the material, adverse effect closing condition and any continued adverse results of the company\u2019s operations or deterioration of its financial condition resulting from losses and loss adjustment expenses.<\/p>\n
Under the amendment, Tower Group International, Ltd (NASDAQ:TWGP) will be required to ensure that all closing conditions apply to all its U.S insurance subsidiaries. This also requires them to have risk based capital that is equal or exceeds the company action risk based capital.<\/p>\n
Tower Group Downgraded<\/b><\/p>\n
The amendment comes at a time that the company has been downgraded by equities researchers Keefe, Bruyette & Woods.\u00a0 The company, as a result is rated as an \u201cUnderperform\u201d with a share price target of $1.50. Significant deterioration in the company\u2019s BVPS looks to have prompted the downgrade. Two research equity firms now have a \u201csell\u201d rating on the company\u2019s stock with six maintaining a \u201cHold\u201d rating. Towers Group consensus market rating stands at a \u201cHold\u201d with an average share price target of $2.94.<\/p>\n
Restructuring of the merger agreement with ACP Re continues to be a biting issue with many analysts, prompting the ongoing downgrades. Despite the uncertainty involving the merger, there is still optimism that the agreement will go through. Analysts at Zack\u2019s on their part have reiterated an underperform rating on the company with a $2.25 share price target. Tower Group International, Ltd (NASDAQ:TWGP) last reported dismal financial results on February 11 with earnings per share of $1.67 against consensus estimates of $1.43.<\/p>\n","protected":false},"excerpt":{"rendered":"
Boston, MA 05\/09\/2014 (wallstreetpr) \u2013 \u00a0Tower Group International, Ltd (NASDAQ:TWGP) shares are plummeting in early morning trading session by a high of 4.43% after announcing […]<\/p>\n","protected":false},"author":15,"featured_media":21727,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"twitter_2902945987_2902945987":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[2236],"tags":[3344,3343],"stock_ticker":[],"class_list":["post-21726","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-nasdaqtwgp","tag-tower-group-international-ltd-nasdaqtwgp","entry"],"acf":[],"yoast_head":"\n