Dabur India’s Burmans Receive Cool Response To Rs.2,116 Crore Open Offer For Religare
Dabur India’s Burmans Receive Cool Response To Rs.2,116 Crore Open Offer For Religare
Strap – The acquisition process was affected due to insider trading violation allegations and chairperson Rashmi Saluja’s removal
The open offer of Rs.2,116 crore by Dabur India’s Burmans to acquire an additional 26 percent stake in the diversified financial services group Religare Enterprises Ltd (REL) has received a lukewarm response.
As per the data, on the offer against 90,042,541 shares (26 percent), only 231,025 shares (0.07 percent) were tendered.
The offer for the acquisition of up to 9,00,42,541 fully paid-up equity shares of Rs.10 each (representing 26 percent of the expanded voting share capital of Religare from the public shareholders) commenced on 27 January.
The offer closed on 13 February and the date of payment of consideration was 17 February.
The tender price for the open offer was fixed at Rs.235 per share. Following the open offer, the shareholding of four entities – M B Finmart Pvt Ltd, Puran Associates Pvt Ltd, VIC Enterprises Pvt Ltd, and Milky Investment & Trading Company would rise to a 24.02 percent. Collectively, they owned 20.15 percent stake in Religare.
In September 2023, the Burman family, a promoter of Dabur and other entities including Eveready Industries, announced a Rs.2,116 crore open offer to Religare shareholders to acquire up to 26 percent stake in the company.
In January 2024, the four entities bought a 3.6 percent stake in Religare for Rs.277 crore through open market transactions.
The three entities - Puran Associates (owned by Anand Burman and Minnie Burman), Vic Enterprises (owned by VC Burman) and M B Finmart (owned by Mohit Burman), acquired Religare’s shares.
However, soon after, the Burmans complained to the Securities and Exchange Board of India (SEBI) for violation of insider trading rules by then-chairperson Rashmi Saluja and the appointment of her choice of Board.
However, Religare’s independent directors while opposing the move, alleged fraud and other breaches by the Burman family entities.
They approached the regulators, including SEBI, the Reserve Bank of India and the Insurance Regulatory and Development Authority.
Recently, Saluja, ousted as director by the company's shareholders, ceased to be a non-independent director.
