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Tower Group International, L.Ş. Message Board

  • ows_1 ows_1 Oct 27, 2013 6:57 AM Flag

    Case for dilution

    !!! Once tower does the dilution, it should be able to replenish its reserve.!!!
    Thus it can put the loss from sandy behind it.
    Yes, the share price will go down (this is what happens in a dilution) but
    if Tower can resume normal operations and there is no future surprises,
    then in the long term the stock price will pick up.

    I know that this is controversial but it is probably the fastest way
    for Tower to get hold of money it so desperately needs.

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    • Your optimism is noted. But Sandy is only a small piece of the puzzle. What got them into this death spiral is a poor book of business. Assuming claims properly reserved the files then the financial crisis would have surfaced some time prior. It will be difficult as many posters have said to maintain good insureds. Their risk will only increase and their broker will place them elsewhere. If we can see this then you know other insurers do as well. Highly doubt another company would take on such an exposure. Outlook bleak

    • Your ignorance is showing. Better bone up on the company and its industry. Might want to try and understand how Wall Street and the capital markets work as well.