Religare Enterprises Receives Acquisition Proposal from US Firm
India's financial services company Religare Enterprises has announced that US businessman Digvijay "Danny" Gaekwad has proposed acquiring a 26% stake in the company.
Burman Family's Staking and Open Offer
In September 2023, the Burman family, founders of consumer goods conglomerate Dabur India, increased their stake in Religare to nearly 25%. Subsequently, they initiated an open offer to purchase an additional 26% of Religare shares.
Independent Directors' Concerns
However, Religare's independent directors expressed concerns over the low offer price of 235 rupees per share.
Gaekwad's Counter Offer
Gaekwad's firm has submitted a request to India's market regulator SEBI to make an open offer of 275 rupees per share, representing a 17% premium to the current offer.
Burman Family Response
Representatives of the Burman family have not yet commented on the development.
Market Valuation and Competition
Religare's current market value stands at 81.83 billion rupees ($949.30 million). If the Burmans succeed in gaining control, they will face competition from other Indian billionaire families in the financial services industry, such as Jio Financial Services and Bajaj Finance.
Legal Challenges
The Burmans' bid has faced regulatory and legal challenges. A minority shareholder has approached the Delhi High Court to halt the Burmans' open offer due to concerns about the offer price.