The open offer is in the best interest of Religare: Burman

Days after advisory firm InGovern Research flagged "vested interest" of the Chairman of Religare Enterprises Rashmi Saluja, owing to excessive remuneration, and regulatory breaches at the company, sources aware of the development told The Business Guardian that Saluja was reluctant to lose control over the company that the Burmans are looking to acquire.

- NIVEDITA MUKHERJEE

The InGovern report accuses Saluja of receiving Rs 480 crore worth options of from REL and its subsidiary Care Health Insurance (CARE). This is over and above the compensation paid at REL, as per the report. The Burman family, promoter of the Dabur Group, which collectively now holds 21.24 per cent in REL, had, through its entities in September, announced a Rs 2,116 crore open offer to shareholders of REL to acquire up to 26 per cent stake in the company. According to a source, initially, REL supported the open offer. "In their filing, they mentioned that this was welcome and even appreciated the Burman family for supporting the company," a source told The Sunday Guardian, indicating violation of corporate governance on several counts. Responding exclusively to queries sent to the Dabur Group, Mohit Burman, member, the Burman family and Chairman, of Dabur India, told the Sunday Guardian, "The Burman family thinks the open offer is in the best interest of Religare and its stakeholders. It is at a fair price considering the prevailing price of Religare today is less than our offer price. The open offer price is calculated as per the formula provided in the SEBI Takeover Regulations. As per this formula, the calculation comes to around Rs 221. Our open offer price, at Rs 235, is at a premium to that price." Burman added that as far as they were aware, "the Religare shareholders are supportive of our open offer as being in the long-term interests of Religare and its subsidiaries".