Following Nalco Holding Company's announcement that Nalco Holding Company agreed to be taken over by Ecolab for $38.80 per share an investigation on behalf of investors of Nalco Holding Company (NYSE: NLC) was announced concerning whether a takeover at $38.80 per share would be unfair to NLC stockholders and certain directors breach their fiduciary duties.

The investigation by a law firm is at a preliminary stage and monitors the takeover rumors. It concerns whether Nalco Holding Company, certain of its officers and directors, and/or others breach their fiduciary duties owed to Nalco Holding (NYSE:NLC) investors in connection with the takeover rumors or in the event of a takeover.

Media reports already said on July 19, 2011 that Ecolab (NYSE: ECL) is near a deal to acquire Naperville, Illinois based Nalco Holding Corp. for $5billion or about $36 per share. The very next day Nalco Holding Corp. confirmed that it agreed to a merger agreement with Ecolab Inc, but at $38.80 per share or 0.7005 share of Ecolab common stock. Under the terms of the proposed transaction, Nalco Holding s shareholders may elect to receive either 0.7005 share of Ecolab common stock per share of Nalco common stock or $38.80 in cash, without interest, per share of Nalco common stock.
Nalco Holding Company said thta the $38.80 per NLC share represent a 34% premium to Nalco Holdings closing stock price on July 19, 2011, the last trading day prior to the announcement of the agreement.

However, Nalco Holding Company, which provides water, energy, air and process technologies and services, has performed exceptionally well for its investors in the past. Nalco Holdings annual Total Revenue rose from $3.91billion in 2007 to $4.25billion in 2010. Nalco Holding Company was able to pull out of a Net Loss of $342.60million in 2008 and report a Net Income for 2009 of $60.50 and $196.20million for 2010. Its first quarter Revenue rose from $956.60million a year earlier to $1,061.40million in 2011 and its first quarter Net Income even rose from $25.20million to $117.40million.
Additionally shares prices for Nalco Holding Company (Public, NYSE:NLC) grew at an exceptional growth rate between the end of 2008 and the end of 2010. Shares of Nalco Holding Company (Public, NYSE:NLC) rose from as low as $8.95 per share in November 2008 to over $32.04 per share in December 2010.

Therefore the investigation by a law firm questions whether a sale process and the price of $38.80 per share are unfair to the shareholders of Nalco Holding Company (NYSE:NLC). The investigation focuses whether the Nalco Holding board of directors undertook an adequate and fair sales process to obtain fair consideration for all shareholders of Nalco Holding Company (NLC) and breached their fiduciary duties to Nalco Holding (NYSE:NLC) shareholder by failing to adequately shop the Company before entering into the transaction with Ecolab Inc. In addition the investigation concerns also whether the Ecolab would underpay for NYSE: NLC shares, thus unlawfully harming Nalco Holding investors. A potential class action lawsuit would seek to maximize the amount of money and information NYSE:NLC shareholders would receive in a buyout, so the law firm.