Bank of America Merrill Lynch Moves CNinsure to No-Rating (CISG)

Bank of America Merrill Lynch is out with its report today on CNinsure CISG, moving CISG to no-rating. In a note to clients, Bank of America Merrill Lynch writes, "CNinsure announced that it has received a preliminary non-binding proposal from TPG, Kingsford Resources Limited (controlled by Chairman Mr. Yinan HU) and CDH (Bidding Consortium) to acquire 65.7% outstanding ordinary shares at US$19.00 per ADS (not owned by CDH & Chairman). Currently, Chairman and related parties own around 34.3%. The offer price implies 12.6x FY11E PER and 17x FY12E PER and 44% premium to last closing price. We believe that CISG's share price will likely converge to the likely privatization price, which is 29% above our DCF value. Given share price will likely be detached from fundamentals until the deal closes, we are moving our rating to no-rating." At the time of posting, shares of CISG were trading pre-market at $17.10, up 29.94% from Friday's close.