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Religare Enterprises and Burman Family, Open Offer Dispute, Goes to SAT

11 July 20242 mins read by Angel One
In its interim ruling, SAT granted Religare a stay on the show-cause notice that Sebi had requested on June 19.
Religare Enterprises and Burman Family, Open Offer Dispute, Goes to SAT
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The ongoing saga between Religare Enterprises and the Burman family, promoters of Dabur India, took a new turn on Wednesday. The Securities Appellate Tribunal (SAT) stayed the show cause notice issued by market regulator SEBI to Religare and its directors on June 19th. This notice was part of a larger dispute regarding an open offer by the Burman family to increase their stake in Religare.

This development stems from an appeal filed by Religare Enterprises. SAT has issued a counter-notice to SEBI, granting them one month to respond. Religare will then have another month to file a rejoinder. The next hearing is scheduled for August 26th, 2024.

The crux of the issue lies in the Burman family’s attempt to acquire a larger stake in Religare. The Burman family claims they triggered a mandatory open offer requirement after their holdings crossed 25%. However, Religare Enterprises, led by Chairperson Rashmi Saluja, has vehemently opposed this move. They argue that the Burman family is not “fit and proper” to undertake such an acquisition.

SEBI, on the other hand, has seemingly taken a neutral stance initially. Through emails dated November 8, 2023, March 1, and April 30, 2024, SEBI provided Religare with multiple opportunities to submit evidence supporting their claims of the Burman family’s unsuitability. Ultimately, SEBI’s June 19th interim order with show cause notice directed Religare to seek necessary approvals for the Burman family’s open offer by July 12th.

SAT’s intervention with a stay order puts the brakes on this timeline and opens the floor for further arguments. Whether Religare can substantiate its claims or if SEBI will ultimately side with the Burman family remains to be seen. With the next hearing scheduled for August, this ongoing dispute promises to keep the financial world watching closely.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.

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