An investigation on behalf of current investors in D&E Communications, Inc. (NASDAQ: DECC), who purchased their share before May 11, 2009, over possible breaches of fiduciary duty and other violations of state law by the Board of Directors of D&E Communications, Inc. was announced.

According to the investigation by a law firm the investigation focuses on the circumstances surrounding the acquisition of D&E Communications Inc (NASDAQ: DECC) by Windstream Corp. concerning potential breaches of fiduciary duty and other violations of state law by the Board of Directors of D&E Communications arising out of their agreement to sell D&E Communications to Windstream under the present conditions. Windstream Corp. reportedly said Monday that it has agreed to acquire D&E Communications. Under the present conditions D&E Communications shareholders will receive 0.650 shares of Windstream stock and $5 in cash for each D&E share. Windstream expects to issue approximately 9.5 million shares of stock valued at $86 million based on the company's closing stock price on May 8, and pay approximately $73 million in cash as part of the transaction. Windstream also will assume estimated net debt of approximately $171 million. Windstream intends to finance the acquisition with existing cash and current capacity on its revolving credit agreement. The combination stock-for-stock and cash merger transaction is valued at approximately $10.88 per share, or $330 million.

According to the investigation the transaction appears to be unfair given that, among other things, D&E Communications book value alone equals $10.76 and D&E Communications generates revenues of approximately $149.5 million per year. Thus, the price agreed to by D&Es Board appears to offer little, if any, price premium to D&Es shareholders (NASDAQ: DECC), so the investigation.

D&E Communications, Inc. is a provider of integrated communications services to residential and business customers in markets throughout the eastern half of Pennsylvania. D&E Communications operates as a rural local exchange carrier (RLEC) in parts of Lancaster, Berks, Lebanon, Chester, Montgomery, Lehigh, Union and Northumberland counties in Pennsylvania. D&E Communications, Inc. (D&E) is located in Ephrata, PA and had $152.55million in total revenue in 2007 and $149.45million in 2008. Shares of D&E Communications, Inc. closed on Wednesday, May 13, 2009, at $10.13 per share and had a 52weekHigh of $10.57 per share, down from $13.74 in 2008, and $18.47 per share in 2007.