India’s Religare says US businessman makes competing provide for stake

By Aditya Kalra

NEW DELHI (Reuters) – India’s Religare Enterprises (NSE:RELG) stated a U.S. businessman has made a proposal to accumulate a 26% stake in it, the most recent twist within the battle for management of the monetary providers firm which has rejected one other bid as being priced too low.

The Indian billionaire Burman household, which has based and controls shopper items conglomerate Dabur India (NSE:DABU), raised its stake in Religare to just about 25% in September 2023, triggering a so-called open provide to purchase extra shares.

Via the open provide course of, which begins on Jan. 27, the Burmans plan to purchase round 26% extra of Religare to bolster their presence in India’s quickly rising monetary providers sector, however Religare’s impartial administrators flagged this week the provide worth of 235 rupees per share was too low.

In a inventory alternate disclosure late on Friday, Religare shared a letter from U.S. entrepreneur Digvijay “Danny” Gaekwad’s agency requesting permission from Indian market regulator SEBI to make an open provide of 275 rupees per share for the Indian firm, a 17% premium to the present provide.

A consultant of the Burman household, Mohit Burman, and the market regulator SEBI didn’t instantly reply to requests for touch upon Saturday. Florida-based Gaekwad didn’t instantly reply to a Reuters’ e mail in search of remark exterior of regular U.S. enterprise hours.

Religare shares closed at 249.40 rupees on Friday, giving it a market worth of 81.83 billion rupees ($949.30 million).

The Burmans, in the event that they win management of Religare, will discover themselves pitted towards different Indian billionaire households within the monetary providers enterprise, together with Mukesh Ambani’s Jio Monetary Providers and family-controlled Bajaj Finance (NSE:BJFN).

However the Burmans’ Religare bid has confronted regulatory and authorized challenges.

Earlier this week, Religare disclosed {that a} minority shareholder had approached the Delhi Excessive Court docket, and was in search of to cease Burmans’ open provide bid.

Authorized papers present that the shareholder holds 500 shares in Religare, and the court docket on Tuesday issued a discover to Burmans and SEBI and stated any subsequent motion – corresponding to an open provide – “shall be topic to the result” of the lawsuit.

($1 = 86.2000 Indian rupees)