NEW DELHI: In what could be a possible setback for the Burman family, the Supreme Court on Friday extended their (Burmans) open offer to acquire an additional 26% stake in Religare Enterprises (REL) to February 12.
The apex court directed the US-based investor Danny Gaekwad to deposit Rs 600 crore in cash or as a bank guarantee by then.
In case the Rs 600 crore is deposited by Gaekwad, then the extension of the open offer will continue till the market regulator takes its decision on Gaekwad’s competing offer, the top court said. If Gaekwad fails to comply, the open offer by the Burmans will proceed as planned.
In a surprise development last month, Florida-based businessman Danny Gaekwad made a counter offer in cash for REL at Rs 275 a share as against Rs 235 apiece made by the Burman Family of the FMCG major Dabur group. The open offer came in the backdrop of an ongoing tussle between the current executive chairperson of REL -Rashmi Saluja - and the Burmans.
The Court has directed India’s capital market regulator - the Securities and Exchange Board of India (SEBI) - to consider the applications by Gaekwad for the takeover of REL. SEBI had earlier returned Gaekwad’s offer saying that it was time-barred. Following this, he questioned the validity of this rejection in court.
The Supreme Court took a strong stance against SEBI, remarking that the offer price should reflect current market conditions rather than a valuation from 2023.
Four Burman family companies on September 2023 made an open offer to acquire a 26% additional stake in Religare for Rs 2,116 crore. The Burmans family is targeting to acquire up to 90,042,541 shares at Rs 235 each. On Friday, the shares of REL settled 5% higher at Rs 253.50 apiece.
The Top Court was hearing two petitions—one filed by Gaekwad and another by minority shareholders of REL—seeking a stay on the company’s 40th Annual General Meeting (AGM), which was scheduled for Friday. The apex court refused to halt the AGM, which was set to discuss the Burman family’s open offer and consider replacing Saluja with a new director.