TOWER GROUP, INC. Press Release
Contact Information:
Thomas Song
Managing Vice President
Tower Group, Inc.
212-655-4789
tsong@twrgrp.com
Tower Group, Inc. Files $60 Million Shelf Registration Statement
New York - November 16, 2006 - Tower Group, Inc. (NASDAQ: TWGP) today filed a
registration statement on Form S-3 with the Securities and Exchange Commission
registering $55 million of equity securities for the account of the Company and
$5 million of common stock for the account of a selling stockholder.
Proceeds from the issuance and sale of securities by the Company are expected to
be used to fund a portion of the purchase price of the Company's recently
announced acquisition of Preserver Group, Inc. and for general corporate
purposes, including to support anticipated premium growth in 2007. The Company
will not receive any of the proceeds from the sale of stock by the selling
stockholder.
Including the expected effects of any financings resulting from this
registration statement, Tower Group, Inc., reiterates its anticipated net income
in 2007 to be in a range between $54.6 million and $56.8 million and diluted
earnings per share in 2007 to be between $2.40 and $2.50 per diluted share.
About Tower Group, Inc.
Tower Group, Inc., headquartered in New York City, offers property and casualty
insurance products and services through its insurance company and insurance
service subsidiaries. Its two insurance company subsidiaries are Tower Insurance
Company of New York which is rated A- (Excellent) by A.M. Best Company and
offers commercial insurance products to small to medium-size businesses and
personal insurance products to individuals and Tower National Insurance Company
which is also rated A- (Excellent) by A.M. Best Company. Its insurance services
subsidiary, Tower Risk Management, acts as a managing general agency, adjusts
claims and negotiates reinsurance terms on behalf of other insurance companies.
This press release may constitute a "free writing prospectus" and an "issuer
free writing prospectus" as such terms are defined in Rule 405 and Rule 433,
respectively, under the Securities Act of 1933, as amended, and relates to the
registration statement on Form S-3 filed by Tower Group, Inc. with the SEC on
November 16, 2006.
Tower Group, Inc. has filed a registration statement (including a prospectus)
with the SEC for the offering to which this communication relates. Before you
invest, you should read
the prospectus in that registration statement and other documents Tower Group,
Inc. has filed with the SEC for more complete information about Tower Group,
Inc, and this offering., You may get these documents fro free by visiting EDGAR
on the SEC Web site at www.sec.gov or the Investor Relations section of Tower
Group, Inc.'s Web site at www.twrgrp.com. Alternatively, Tower Group, Inc., any
underwriter or any dealer participating in the offering will arrange to send you
the prospectus if you request it by calling toll-free (877) 490-0049.
Cautionary Note Regarding Forward-Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. This release or any other written or oral
statements made by or on behalf of the Company may include forward-looking
statements that reflect the Company's current views with respect to future
events and financial performance. All statements other than statements of
historical fact included in this release are forward-looking statements.
Forward-looking statements can generally be identified by the use of
forward-looking terminology such as "may," "will," "plan," "expect," "intend,"
"estimate," "anticipate," "believe" or "continue" or their negative or
variations or similar terminology. All forward-looking statements address
matters that involve risks and uncertainties. Accordingly, there are or will be
important factors that could cause our actual results to differ materially from
those indicated in these statements. We believe that these factors include but
are not limited to ineffectiveness or obsolescence of our business strategy due
to changes in current or future market conditions; increased competition on the
basis of pricing, capacity, coverage terms or other factors; greater frequency
or severity of claims and loss activity, including as a result of natural or
man-made catastrophic events, than our underwriting, reserving or investment
practices anticipate based on historical experience or industry data; the
effects of acts of terrorism or war; developments in the world's financial and
capital markets that adversely affect the performance of our investments;
changes in regulations or laws applicable to us, our subsidiaries, brokers or
customers; changes in the level of demand for our insurance and reinsurance
products and services, including new products and services; changes in the
availability, cost or quality of reinsurance and failure of our reinsurers to
pay claims timely or at all; loss of the services of any of our executive
officers or other key personnel; the effects of mergers, acquisitions and
divestitures; changes in rating agency policies or practices; changes in legal
theories of liability under our insurance policies; changes in accounting
policies or practices; and changes in general economic conditions, including
inflation and other factors. Forward-looking statements speak only as of the
date on which they are made, and the Company undertakes no obligation to update
publicly or revise any forward-looking statement, whether as a result of new
information, future developments or otherwise.
Regarding the transactions described above, we would add the following cautions
to those included in our filings with the SEC:
-- the acquisition of Preserver may not occur as expected or it may take
longer to accomplish than we expect;
-- governmental approvals of the acquisition may not be obtained, or adverse
regulatory conditions may be imposed in connection with governmental approvals
of the acquisition;
-- we may not be as successful as we anticipate in managing the integration
of Preserver, including with respect to realizing cost savings and distributing
our products through Preserver's agencies;
-- the completion of the acquisition is subject to the satisfaction or
waiver of certain conditions which are beyond our control; and
-- adverse conditions in the capital markets may require us to sell more
shares than we anticipate and may make it more expensive for us or limit our
ability to raise capital to support this acquisition and other growth
opportunities.
For more information visit Tower's website at http://www.twrgrp.com/.