Yuanxi Zhang
Long/short equity, value, special situations

Termination Risks Of NTS Realty Holdings Offer Asymmetrical Risk Reward Profile

Recommendation: Short NTS Realty Holdings Limited Partnership (NYSE MKT: NLP)

Catalysts: Termination of the merger agreement after September 30th, 2013

6-Month Target Price: $3.06 or less


After postponing a go-private deal several times since the initial proposal over a year ago, NTS Realty Holdings (NYSEMKT:NLP) has made little progress and will almost certainly miss the upcoming deadline of September 30th. Multiple unresolved lawsuits are blocking the financing and the recent rise in rates gives the financing party incentive to walk away rather than to stay in the deal. As the market incorrectly predicts a 91% probability of the deal to be closed on September 30th, we see a compelling risk reward profile in taking a...

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