UPDATE: Keefe, Bruyette & Woods Downgrades Tower Group International On Elevated Risk Of Merger Agreement Restructuring

In a report published Wednesday, Keefe, Bruyette & Woods analyst Robert Farnam downgraded the rating on

from Market Perform to Underperform, and lowered the price target from $3.00 to $1.50. In the report, Keefe, Bruyette & Woods noted, “Following the release of Tower's 2013 10-K and the significant deterioration in BVPS (to $1.67 at YE13 from $3.62 at the end of 3Q13), we are downgrading the shares to Underperform (from MP) due to the elevated risk that the merger agreement with ACP Re is restructured and the offering price per TWGP share is lowered. We do still expect the merger to close. Reducing estimates and PT (to $1.50 from $3.00).” Tower Group International closed on Tuesday at $2.43.