NEW DELHI: Religare Enterprises Ltd (REL) said on Thursday that Rashmi Saluja has ceased to be a director on its board after failing to secure shareholder approval for her reappointment.
Effective February 7, 2025, Saluja is no longer a non-independent director, REL stated in a regulatory filing. The decision followed a clarification sought by the Reserve Bank of India (RBI), with the response received on Thursday.
REL also referenced a report by the Scrutinizer, which revealed that 97% of votes were cast against the resolution to reappoint Saluja to the board, dated February 7, 2025.
Saluja’s exit comes amid her ongoing conflict with the Burman family, who are in the process of acquiring an additional 26% stake in REL through an open offer. Her departure follows recent accusations by REL investors that she hijacked the company’s annual general meeting (AGM), where she reportedly dropped the agenda item concerning her reappointment.
Saluja had maintained that her directorship was not subject to retirement at this time.
In a bid to prevent her removal, Saluja had approached the Delhi High Court, seeking intervention. She also leveled charges against Religare, market regulator Sebi, and JM Financial, alleging non-compliance and violations of RBI conditions, among other issues.
Saluja’s exit coincides with a competing open offer for Religare by US-based investor Danny Gaekwad. However, Gaekwad reportedly missed the extended deadline set by the Supreme Court to deposit the required Rs 600 crore, effectively sidelining his proposal.
This development, according to experts, paves the way for the Burmans to become the majority stakeholders in REL. As of September 30, 2024, the Burmans, through four entities—Finmart Private Ltd, Puran Associates Private Ltd, VIC Enterprises Private Ltd, and Milky Investment & Trading Company—collectively hold a 25.12% stake in REL. Following the open offer, their stake is expected to rise to 53.94%.
The Burmans plan to acquire the additional 26% stake in Religare at an offer price of Rs 235 per share.
The conflict between Saluja and the Burmans has been ongoing since the open offer was triggered in September 2023. Over the past year and a half, both parties have exchanged serious allegations. Saluja’s camp initially accused the Burman family of market manipulation, material breaches of regulatory obligations, and involvement in various "frauds and financial improprieties." In response, the Burmans alleged that Saluja violated insider trading rules and raised objections to her high compensation, particularly the ESOPs allotted to her.
The ousting of Saluja marks a pivotal moment in the ongoing power struggle at Religare, with the Burmans now poised to consolidate their control over the company.