Tower Group plummets as merger deal called into question

|About: Tower Group, Inc. (TWGP)|By:, SA News Editor

Downgrading Tower Group (TWGP -13.9%) to Underperform and halving its price target to $1.50, KBW notes an "elevated risk" of the merger with AmTrust (AFSI -1.1%) subsidiary ACP Re being restructured at a lower price (though it still expects the deal to close). At issue is the release of Tower's 2013 10-K which showed a big decline in book value to $1.67 per share at year's end from $3.62 at the end of Q3.

The 2-day decline for Tower since the downgrade is about 21%.

Buy the dip says Blue Ridge Buffettologist in an SA Pro article embargoed until tomorrow morning.