China Security & Surveillance Tech. Inc. Buyout Under Investor Investigation

After China Security & Surveillance Tech. Inc. announced that its board of directors received a going private proposal from its Chairman and Chief Executive Officer, Mr. Guoshen Tu an investigation on behalf of investors of China Security & Surveillance Tech. Inc. (NYSE:CSR) concerning the potential unfairness of the takeover and possible breaches of fiduciary duty was announced.

The investigation by a law firm concerns whether certain directors and officers at China Security & Surveillance Tech. Inc. (NYSE:CSR) or others breached or will breach their fiduciary duties in connection with proposed buyout by its Chairman and CEO, Mr. Guoshen Tu.

On Tuesday March 8, 2011 China Security & Surveillance Technology, Inc. (NYSE: CSR) announced that its Board of Directors has received a non-binding proposal letter from its Chairman and Chief Executive Officer, Mr. Guoshen Tu, for Mr. Tu to acquire all of the outstanding shares of China Security & Surveillance Technology, Inc. (NYSE: CSR) common stock not currently owned by Mr. Tu, certain members of the management and their affiliated entities, in a going private transaction for $6.50 per share in cash subject to certain conditions.
China Security & Surveillance Technology Chairman and CEO Mr. Tu currently beneficially owns approximately 20.9% of NYSE: CSR's common stock. Chairman and CEO Mr. Tu said the offered $6.50 represents a premium of 58.5% to the Company's closing price on March 7, 2011.

Indeed shares of China Security & Surveillance Tech. Inc. (Public, NYSE:CSR) jumped in response to the buyout proposal from $4.04 on March 7 to $5.45 on March 8, 2011.

However, CSR shares traded as early as January 3rd at $5.50 per share, on Nov. 8 as high as $5.92, and in October 2010 as high as $6.31, leaving CSR stockholders with only a meager premium.

Stockholders of China Security & Surveillance Tech. Inc, that purchased CRS shares during April 2010, when CRS shares traded as high as $7.53, or purchased their CRS shares during March or January 2010, when CRS traded as high as $8.68 per share, would actually hand their CRS shares over at a discount. Additional China Security & Surveillance Tech. Inc. has performed exceptionally well for its shareholders in the past. Its 12months Total Revenue went from $106.99million in 2006 to $580.87million in 2009. Its Net Income went from $22.93million in 2006 to $56.58million in 2009. For the first three quarters in 2010 China Security & Surveillance Tech. Inc. reported a combined nine months Total Revenue of $470.69million with a Net Income of $48.35million.

Therefore the investigation monitors and concerns whether China Security & Surveillance Tech Board of Directors will undertake an adequate and fair sales process in the event of the takeover to obtain the maximized consideration for all shareholders of China Security & Surveillance Tech. Inc. (NYSE:CSR) and breached or will breach their fiduciary duties to China Security & Surveillance Tech (NYSE:CSR) shareholder by failing to adequately shop the Company before entering into any transaction. The investigation concerns also whether Mr. Tu would underpay for NYSE:CSR shares, thus unlawfully harming CSR investors. A potential class action lawsuit would seek to maximize the amount of money and information for NYSE CSR shareholders would receive in a buyout, so the law firm.