Irdai questions Care brass on Esops issue

Religare unit asked to reply in a week on "excessive" grant

- Anirudh Laskar

The insurance regulator has asked top executives of Care Health Insurance Ltd to explain the issue of stock options to non-executive chairperson Rashmi Saluja despite being told not to do so, two people aware of the matter said.

On 22 November, officials of the Insurance Regulatory and Development Authority of India (Irdai) summoned Anuj Gulati and Anoop Singh of Care Health and questioned them about “excessive" stock options issued to Saluja and Gulati, the people said on the condition of anonymity. While Gulati is managing director and chief executive of Care Health, Singh is chief compliance officer.

“Irdai is very concerned about 22.7 million employee stock options (Esops) approved by the Dr. Saluja-led board of Care Health to Dr. Saluja herself. This is worth hundreds of crores of money for one person who is not a promoter, just an employee," one of the two people said.

The issue of stock options came into focus after the Burman family (of Dabur) made an open offer for Religare Enterprises Ltd, the parent of Care Health. After the Religare board opposed the proposal, the Burmans alleged that Saluja, who is also non-executive chairperson of Religare, had received hefty stock options from Care.

The open offer by the Burman family for Religare, where it already owns a 21.54% stake, was announced on 25 September. The offer for the additional 26% at ₹235 per share will cost ₹2,116 crore. The total 51% stake that the Burmans aim to own is worth about ₹3,400 crore. After a brief initial welcome, the Religare board claimed the offer price was low and accused the Burmans of having links with Radha Soami Satsang Beas (RSSB) and Religare founders Shivinder and Malvinder Singh, who are facing fraud charges.