The announcement by DEI Holdings, Inc. that its board of directors agreed to a takeover of DEI Holdings by funds affiliated with Charlesbank Capital Partners has prompted an investigation on behalf of investors of DEI Holdings, Inc. (PINK:DEIX) concerning whether the proposed acquisition is unfair to DEIX stockholders and whether certain directors breached their fiduciary duties.

The investigation by a law firm concerns whether certain directors and officers at DEI Holdings, Inc. or others breached their fiduciary duties in connection the proposed merger.

On May 12, 2011 DEI Holdings, Inc. (PinkSheets: DEIX.PK) announced that it has entered into a merger agreement to be acquired by funds affiliated with Charlesbank Capital Partners in an all-cash transaction. Under the terms of the proposed transaction,shareholders of the outstanding common shares of DEI Holdings will receive approximately $3.79 - $3.81 per DEIX share in cash. DEI Holdings, Inc said the price represents a premium of approximately 142% to DEI Holdings' closing share price on May 12, 2011.

Following the announcement shares of DEI Holdings, Inc. jumped from $1.57 per share on May 12 to $3.65 per share on May 13.

However, DEI Holdings, Inc disclosed that funds affiliated with Trivest Partners, which own approximately 9.2 million common shares, representing approximately 36% of total shares outstanding, have already agreed to vote those shares for approval of the merger.

Therefore the investigation concerns whether the DEI Holdings Board of Directors undertook an adequate and fair sales process to obtain fair consideration for all shareholders of DEI Holdings, Inc. (PINK:DEIX) and breached their fiduciary duties to DEI Holdings (DEIX) shareholder by failing to adequately shop the Company before entering into the transaction. The investigation concerns also whether funds affiliated with Charlesbank Capital Partners would underpay for PINK DEIX shares, thus unlawfully harming DEIX stockholders. A potential class action lawsuit would seek to maximize the amount of money and information DEI Holdings shareholders would receive in a buyout, so the law firm.