The capital market regulator Sebi on Tuesday rejected the competing open offer made by the US-based entity Danny Gaekwad Developments & Investments for acquisition of Religare Enterprises Ltd (REL) as it did not meet necessary regulations.
The Securities and Exchange Board of India (Sebi) said in a communication dated January 28 to REL, "letters submitted by Digvijay Laxmansinh Gaekwad are being returned since the same is not an exemption application in terms of Regulation 11 of SEBI (SAST) Regulations, 2011."
The regulator cited an e-mail dated January 25, 2025, forwarding a letter dated January 24, 2025, from Digvijay Laxhamsinh Gaekwad, Danny Gaekwad Developments & Investments, Florida, Religare said in a regulatory filing attaching the letter issued by Sebi.
Danny Gaekwad Developments & Investments had offered to acquire a 26 per cent stake in the financial services firm at a price higher than that offered by four entities promoted by the Burman family.
Digvijay Laxmansinh Gaekwad, who styles himself as a recognized global investor, has agreed to pay a 17 per cent price premium of Rs 275 per share of REL over the open offer price bid of Rs 235 per equity.
The Burmans' open offer by Religare Enterprises to raise an additional 26 percent stake from the open market commenced on January 27 following the regulatory approvals.
The open offer relates to the purchase of up to 9,00,42,541 fully paid-up equity shares of face value of Rs 10 each, constituting 26 per cent of the expanded voting share capital of REL from the public shareholders.
The group entities which are Burman are Finmart Private Ltd, Puran Associates Private Ltd, VIC Enterprises Private Ltd, and Milky Investment & Trading Company. After the open offer, Burman's holding in REL will be up at 53.94 percent.
Last month, the Reserve Bank gave its nod to the open offer by the Burman family -- promoters of FMCG major Dabur -- to acquire an additional 26 per cent stake in NBFC firm Religare Enterprises Ltd (REL).
As of September 30, 2024, Burmans, through its four entities, collectively owns a 25.12 per cent stake in REL.
The Burman family, a Dabur India promoter and promoter of other firms such as Eveready Industries, through their entities, had announced an open offer to buy up to 26 per cent stake in the firm in September 2023 with an amount of Rs 2,116 crore to shareholders of REL.
Soon after the open offer bid, Burmans complained to capital market regulator Sebi for violation of insider trading rules by the chairperson and appointment of board of her choice.
However, it was contested by REL independent directors, who raised red flags alleging fraud and other breaches by Burman family entities and approached regulators, including markets regulator Sebi, the RBI, and the Insurance Regulatory and Development Authority.
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