The Burman family initially showed interest in acquiring a controlling stake in Religare Enterprises in September 2023 and has been advocating for the removal of chairperson Rashmi Saluja. Recently, a Bangkok-based minority shareholder approached the Delhi High Court to stop the Burman family’s attempt to increase their stake in the financial services firm. This development adds a new layer to the ongoing struggle for control of Religare Enterprises Ltd.
Sapna Govind Rao, who claims to hold 500 shares in Religare, has requested the court to consider a competing open offer of ₹5,000 crore from Florida-based businessman Digvijay ‘Danny’ Gaekwad. Rao’s urgent application was reviewed by Mint. Shortly after her filing, Religare announced to the stock exchanges that the Securities and Exchange Board of India (SEBI) had rejected Gaekwad’s proposal for not adhering to the exemption application rules under India’s takeover code. Gaekwad had sought SEBI’s approval for his offer to acquire a 55% stake in Religare at ₹275 per share, which is higher than the Burmans’ offer of ₹235 per share. Following this news, Religare’s shares dropped nearly 3.7% on the BSE, closing at ₹243.05, while the benchmark Sensex rose by 0.71%.
Religare stated in its exchange filing that Gaekwad’s letters were returned as they did not qualify as an exemption application under Regulation 11 of SEBI (SAST) Regulations, 2011. However, Rao has urged that minority shareholders be allowed to assess Gaekwad’s higher counter-offer. In her application to the Delhi High Court, Rao’s lawyer argued that proceeding with the Burman family’s acquisition without considering the competing offer could lead to significant financial loss for public shareholders, including Rao herself, who could benefit from the competitive pricing mechanism outlined in Regulation 20 of the SEBI Takeover Regulations. Therefore, it is crucial for SEBI to exercise its regulatory authority appropriately.
