Burman Family’s Open Offer for Religare Enterprises to Start on January 27

The Burman family, promoters of FMCG company Dabur India, will launch an open offer to acquire an additional 26% stake in Religare Enterprises Ltd (REL). The open offer, valued at ₹2,116 crore, is scheduled to start on January 27, 2025, and close on February 7, 2025.

Religare Enterprises Ltd (REL) is trading at ₹273.00, down 0.40% today (as of today, Jan 20, 11:34 am), but has gained 15.65% over the past 6 months and 25.78% over the past year.

Details of the Open Offer

The offer aims to acquire up to 9,00,42,541 fully paid-up equity shares of REL. Each share has a face value of ₹10 and represents 26% of the expanded voting share capital. The acquisition will be executed by four Burman family entities: M.B. Finmart Private Ltd, Puran Associates Private Ltd, VIC Enterprises Private Ltd, and Milky Investment & Trading Company.

Ownership and Approvals

As of September 30, 2024, the Burman family held a 25.12% stake in REL through their four entities. The open offer is an attempt to increase their stake in the company. The Reserve Bank of India (RBI) approved the open offer in December 2024. The process has met the necessary regulatory requirements, enabling the offer to proceed as planned.

Opposition from Directors

REL’s independent directors have raised objections to the open offer, alleging fraud and breaches by the Burman family entities. Complaints have been filed with the Securities and Exchange Board of India (SEBI), the RBI, and the Insurance Regulatory and Development Authority (IRDA).

Timeline of the Open Offer

The Burman family announced the open offer in September 2023. Public shareholders will have the opportunity to tender their shares during the offer period, which runs from January 27 to February 7, 2025.

Background

Religare Enterprises is a non-banking financial company (NBFC). The Burman family’s existing investments include Dabur India and Eveready Industries. The outcome of this open offer will impact the ownership structure of REL, depending on the response from public shareholders and regulatory observations.

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