FOUNDATION MAGAZINE FINANCIAL ADVICE STOCKLETTERS PORTFOLIO PMS BOOKS
BUY
Delhi HC Refuses To Stay Religare AGM amid Open Offer Controversy
SN Thyagarajan (Bar  and  Bench) 30 January 2025
Economy & Nation
The Delhi High Court on Thursday refused to stay the Annual General Meeting (AGM) of Religare Enterprises Ltd (REL) scheduled for February 7, amid controversy over a proposed takeover of REL by the Burman family, which owns Dabur (Sapna Govind Rao Vs Union of India).
 
A minority shareholder called Sapna Govind Rao has moved the Court alleging that the takeover is being mishandled and that the Burman family's offer undervalues REL shares. 
 
The offer by the Burman family to acquire REL is slated to be considered at the upcoming AGM. 
 
Justice Manoj Jain, who heard the matter found that the reasons given by Rao were not sufficient to stay the AGM. Therefore, it declined to grant Rao any such interim relief. 
 
Rao, who holds 500 shares in REL, has challenged the Reserve Bank of India’s (RBI) conditional approval for the acquisition of REL by the Burman family. Rao's petition calls on the Court to quash the RBI’s approval dated December 9 2024. The plea also seeks greater transparency in the acquisition process. 
 
The Court today heard an application filed by Rao, by which it was contended that a competing offer has been received from M/s. Danny Gaekwad Developments & Investments, Florida, which values REL shares at 275 per share - a 17 per cent premium over the Burman family’s offer of 235 per share. 
 
Rao (petitioner) contended that this development necessitates a reconsideration of the acquisition process to protect the interests of minority shareholders.
 
According to the petitioner, the competing offer - which was disclosed by REL to the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) on January 24 - has fundamentally altered the acquisition landscape. 
 
The petitioner contends that proceeding with the Burman family’s offer would cause grave financial loss to public shareholders. 
 
Rao emphasised that the competing offer should be allowed to run parallel to the Burman family’s offer, ensuring a fair and competitive price discovery process. 
 
“The Competing Offer presents a higher valuation of REL shares, thereby prioritising and advancing the financial interests of minority shareholders, including the Petitioner," Rao's petition said.
 
The petitioner also highlighted the urgency of the matter, noting that the open offer period for REL's proposed takeover by the Burman family runs from January 27, 2025 to February 7, 2025. 
 
Shareholders who sell their shares during this period unaware of the higher competing offer would face irreparable financial harm, Rao said.
 
Additionally, the petitioner pointed out that REL’s AGM, scheduled for February 7, was announced before the competing offer was disclosed. 
 
Proceeding with the AGM under these circumstances would deprive shareholders of the opportunity to make an informed decision, violating principles of corporate governance and transparency, Rao argued. 
 
The petitioner, therefore, urged the Court to direct Securities Exchange Board of India (SEBI) and the RBI to evaluate the competing offer and stay the Burman family’s acquisition process until a fair assessment is completed. 
 
The petition also sought a stay on the AGM to prevent any resolutions from being passed under what it calls “opaque and prejudicial circumstances.” 
 
“Proceeding with the AGM under such opaque and prejudicial circumstances would deprive the shareholders an opportunity to make an informed decision and will lead to irreversible harm to their rights," the plea said. 
 
During today's hearing, the SEBI informed the High Court that the communications from Gaekwad have already been returned, meaning that the competing offer is no longer in play. 
 
Therefore, Rao's application to stay the AGM has become infructuous, the Court was told.
 
Comments
david.rasquinha
1 month ago
Rashmi Saluja has been playing games with the regulations for far too long, while SEBI as usual sits on its hands, terrified of doing anything meaningful.
Reply
Economy & Nation
Tata Steel: Did Expedience Trump Prudence?
Ranganathan V, 31 January 2025
Earlier this month, Tata Steel Ltd informed the stock exchanges of moving a curative petition against the nine-judge constitutional bench decision of the Supreme Court in July 2024 holding that the state governments have power to levy...
Economy & Nation
Religare Enterprises: US-based Danny Gaekwad's Competing Open Offer Rejected by SEBI
Moneylife Digital Team 29 January 2025
Market regulator Securities and Exchange Board of India (SEBI) has rejected a competing open offer by the US-based entity Danny Gaekwad Developments & Investments for buying a 26% stake in Religare Enterprises Ltd (REL) as the offer...
Economy & Nation
Fake Tech Support Call Centre: Gurugram Court Awards Rs55 Lakh to Microsoft as Damages in Trademark Infringement
Ratna Singh (Bar  and  Bench) 28 January 2025
A commercial court in Gurugram recently awarded Microsoft Rs55 lakh in damages after a company, Retnec Solutions Pvt Ltd was found guilty of trademark infringement and running fraudulent call-centre operations using Microsoft's...
Economy & Nation
Lodha Trademark: Bombay HC Urges Lodha Brothers To Settle Dispute by Mediation
Sahyaja MS (Bar  and  Bench) 28 January 2025
The Bombay High Court on Monday suggested that the Lodha brothers, who are embroiled in a long-standing trademark dispute, consider mediation to resolve the matter.
 
Justice Arif Doctor said that since the issue stems from a family...
  • EDITORS'
    PICKS
  • MOST
    POPULAR
  • MOST
    READ
Free Helpline
Legal Credit
Feedback
Buy Now!

Absolute Power

Inside story of the National Stock Exchange’s amazing success, leading to hubris, regulatory capture and algo scam

View Options

The Scam: Now in it's 12th Printing

29 Years Of The Scam: The Perennial Bestseller, reads like a Thriller!
#Scam92: Read the actual story.

Buy Now Gift Know More

Moneylife Online Magazine

Fiercely independent and pro-consumer information on personal finance.

1-year online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.

Buy Now Gift Know More

Monthly Digital Access

Fiercely independent and pro-consumer information on personal finance.

30-day online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.

Buy Now Know More

Full Archive access

Fiercely independent and pro-consumer information on personal finance.
Complete access to Moneylife archives since inception ( till the date of your subscription )

Buy Now

Stockletters in 5 Flavours

Outstanding research that beats mutual funds year after year

Buy Now Know More

MAS: Complete Online Financial Advisory

(Includes Moneylife Online Magazine)

Buy Now Know More
We are listening!
Reset
Success!

To continue

Please

or

With