Following the announcement by Ness Technologies, Inc that its board of directors agreed to a buyout of Ness Technologies by an affiliate of Citi Venture Capital International at $7.75 per share in cash an investigation on behalf of investors of Ness Technologies, Inc. (NASDAQ NSTC) was announced concerning whether the offer to take over Ness Technologies, Inc. and the sale process are unfair to investors of Ness Technologies, Inc. (NSTC) and whether certain of its officers and directors or others breached their fiduciary duties owed investors in Ness Technologies, Inc. (Public, NASDAQ:NSTC).

The investigation by a law firm concerns whether Ness Technologies, Inc., certain of its officers and directors, and/or others breached their fiduciary duties owed to Ness Technologies, Inc. (NASDAQ NSTC) investors in connection with the acquisition.

The Israeli newpaper Calcalist reportedly last Winter that the four U.S. investment funds, Francisco Partners, Foundation Capital, City Venture Capital, and Warburg Pincus, have submitted bids to buy Ness Technologies, Inc at a value of $300 million. Another Israeli paper, Globes, reportedly said that Citigroups private equity crew is looking at Ness Technologies, Inc.
Shares of Ness Technologies, Inc. (NSTC) jumped in response to the takeover rumors from $4.625 last Friday to $5.38 per share on Monday.
Then on June 10, 2011Ness Technologies Inc. announced that the company has entered into a merger agreement under which an affiliate of Citi Venture Capital International will acquire Ness Technologies, Inc in an all-cash transaction valued at approximately $307 million. Under the terms of the proposed transaction, Ness Technologies (NSTC) stockholders will receive $7.75 per share in cash for each share of common stock they hold. Ness Technologies said the offer represents a premium of 17.6% over the closing price of the company's shares on the Nasdaq Global Select Market on June 9, 2011, the last trading day prior to today's announcement, or 22.2% over the average closing price of the company's shares over the 30 trading days prior to June 10, 2011.
However, at least one analyst has set a price target of $8.00 per share for Ness Technologies (NSTC) stock. Additionally Ness Technologies performance has been increasing. Ness Technologies 12months Total Revenue went from $511.95million in 2009 to $571.79million in 2010. While in 2009 Ness Technologies had to report a Net Loss o $10million it was wable to report a Net Income of $8.41million for 2010.
Therefore the investigations monitor the proposed transaction and concern whether the Ness Technologies Board of Directors undertook an adequate and fair sales process to obtain fair and maximized consideration for all shareholders of Ness Technologies, Inc. (NASDAQ: NSTC) and in particular breached their fiduciary duties to Ness Technologies (NSTC) shareholder by failing to adequately shop the Company before entering into the transaction.
Given also the recent analyst's target price of $8 per NSTC share the investigation concerns also whether the affiliate of Citi Venture Capital International would underpay for NASDAQ:NSTC shares, thus unlawfully harming NSTC stockholders. A potential securities class action lawsuit would seek to maximize the amount of money and information NASDAQ: NSTC shareholders would receive in a buyout, so the law firm.