Saluja sues Religare to block vote at 7 Feb AGM

Religare Enterprises Ltd CEO and chairperson Rashmi Saluja has sued the conglomerate she heads to thwart a potential takeover and extend her tenure, pitting herself against four of the company's five independent directors, in arguably one of the first such instances in a public company.

- Neha Joshi & Varun Sood

On Tuesday, Saluja filed a case against Religare in the Delhi High Court, seeking the court's intervention to stop the annual general meeting (AGM) scheduled for 7 February. One of the resolutions shareholders will vote on is Saluja's reappointment as director.

The billionaire Burman family, promoters of Dabur Ltd, has a little over 25% stake in Religare and has offered to buy 26% more from minority shareholders through an open offer at ₹235 a share. Saluja runs the risk of being ousted, as her reappointment needs to be approved by at least half of the shareholders. Earlier this month, proxy advisor InGovern Research Services recommended that shareholders vote against the reappointment.

"This is a fight between the CEO and the majority of the board members. This is an absurd situation where a board member and CEO (Rashmi Saluja), without informing the other directors of the board or sharing the petition, has sued the company, and in a sense, sued herself," senior Supreme Court lawyer Nalin Kohli said.

Kohli represents the four independent directors -- Praveen Tripathi, Malay Sinha, Ranjan Dwivedi and Preeti Madan. Mint could not independently ascertain the stance of the fifth independent director, Hamid Ahmed. The court will hear the matter on 4 February.

"I am not aware of such a situation happening in a publicly listed firm in India, where a CEO and sitting board member has sued the company," said Kohli.