UPDATE: Compass Point Downgrades Meadowbrook Insurance Group to Neutral, Raises PT on Acquisition News

In a report published Wednesday, Compass Point analyst Ken Billingsley downgraded the rating on

from Buy to Neutral, but raised the price target from $7.00 to $8.65. In the report, Compass Point noted, “We are raising our price target to $8.65 from $7 and lowering our rating to Neutral from Buy following the announcement that MIG will be acquired by Fosun International Limited. After the close of business yesterday, MIG announced they had entered into a definitive agreement in which Fosun would acquire MIG for $8.65 per share or ~ $433M in an all cash deal. This represents a 1.04x multiple to the company's recent tangible book value per share of $8.36. The deal has been approved by both the boards of MIG and Fosun and is expected to be completed in the second half of 2015. As Fosun is a China-based investment group and does not currently have any insurance operations in the U.S. we expect the regulatory approvals will take an extended period of time to complete. However, we would not anticipate a competing offer in excess of the current bid to emerge.” Meadowbrook Insurance Group closed on Tuesday at $7.13.