NEW DELHI: The Burman Family on Monday accused the current board of Religare Enterprises (REL) for delaying the completion of open offer.
This statement by the Burmans came after Religare informed the stock exchanges that the Reserve Bank of India (RBI) has rejected the family’s open offer proposal for acquiring majority stake in the diversified financial company.
“The banking regulator has taken note of the non-cooperation by Religare and has in turn directed Religare to make the necessary applications to the banking regulator. This situation once again highlights the partisan approach the board of Religare has taken which has resulted in delay of the completion of the open offer at the cost of public shareholders,” said Spokesperson of the Burman family.
“Hopefully with these directions, the board of Religare will retain its independence and fulfil its fiduciary duty of applying to the RBI.” The RBI rejected the Burman family’s open offer proposal for REL as the application should be submitted by the NBFC and not the acquirer, informed Religare. The central bank, in its letter dated February 5, 2024, stated the proposal cannot be acceded as it is not the acquirer but the NBFC in which change in management and control is taking place should submitting the application.
The fresh direction by the RBI came a month after the country’s anti-trust body, the Competition Commission of India (CCI), gave its approval for the acquisition of a 5.27% stake in REL by four firms controlled by the Burman family. CCI also gave its nod to the Burmans for the follow-up open offer to buy up to another 26% in REL and take its holding to up to 53.94%.
The Burman family, the promoter of FMCG major Dabur, had in September 2023 announced a Rs 2,116 crore open offer to acquire up to 26% additional stake in the REL.