Yuanxi Zhang
Long/short equity, value, special situations

WSP Holdings: The Deal Is Running Out Of Time Again

Recommendation: Short WSP Holdings (NYSE: WH)

Target Price: $1.50 or less

Thesis

We are highly suspicious if the go-private deal of WSP Holdings (NYSE:WH) will close before the outside date. The company again fails to file the annual report on time this year. Its profitability remains poor. The corruption investigation related to PetroChina could heavily impact the company, which is a possible reason the previous acquirer walked away. Again, the company has run out of time to close the deal. Considering all these factors, we believe a short position is attractive given the favorable risk-reward ratio.

Updates on the Merger

On March 19th, WSP Holdings provided an update on the pending go-private deal. The previous acquirer,...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
WITH SEEKING ALPHA PRO, INVESTORS CAN ALSO:
  • Access Top Ideas, chosen by Seeking Alpha’s editors
  • Filter long and short ideas by market cap and sector
  • Get Coverage of over 5,000 stocks, many of which have little or no coverage elsewhere
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO." Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else." Patrick Rice, Mainstay Capital Management
100% Satisfaction Guaranteed
Money back guarantee. Seeking Alpha PRO members receive a no-questions-asked refund for membership on months paid and not used. Details