Rao, who owns 500 shares in REL, has also challenged the Reserve Bank of India’s (RBI) conditional approval of the Burman family’s acquisition of REL. She filed a petition requesting the court to cancel the RBI’s approval, which was given on December 9, 2024. She has also asked for more transparency in the takeover process.
NEW DELHI: The Delhi High Court on Thursday refused to stop the Annual General Meeting (AGM) of Religare Enterprises Limited (REL), which is scheduled to be held on February 7, 2025. The AGM is set to discuss a takeover proposal by the Burman family, the owners of Dabur.
This decision came after a minority shareholder, Sapna Govind Rao, moved the court, claiming that the takeover process was not being handled properly. She also argued that the Burman family’s offer undervalues REL shares. The offer by the Burmans will be considered at the upcoming AGM.
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Justice Manoj Jain, who heard the matter, found that Rao’s reasons were not strong enough to justify stopping the AGM. Therefore, the court did not grant her any relief.
Rao, who owns 500 shares in REL, has also challenged the Reserve Bank of India’s (RBI) conditional approval of the Burman family’s acquisition of REL. She filed a petition requesting the court to cancel the RBI’s approval, which was given on December 9, 2024. She has also asked for more transparency in the takeover process.
During the hearing, Rao’s legal team informed the court that another company, M/s. Danny Gaekwad Developments & Investments from Florida, had made a competing offer for REL shares. This offer values the shares at Rs.275 per share, which is 17% higher than the Burman family’s offer of Rs.235 per share.
Rao argued that this new offer changes the situation completely and that the acquisition process should be reconsidered to protect minority shareholders’ interests.
According to her petition, the competing offer was disclosed by REL to the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) on January 24, 2025. She claimed that accepting the Burman family’s lower offer would cause significant financial loss to public shareholders.
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Rao emphasized that both offers should be allowed to run side by side so that shareholders can get the best price for their shares. She stated:
“The Competing Offer presents a higher valuation of REL shares, thereby prioritising and advancing the financial interests of minority shareholders, including the Petitioner.”
She also pointed out that the open offer period for the Burman family’s acquisition runs from January 27, 2025, to February 7, 2025. Shareholders who sell their shares without knowing about the competing offer would suffer “irreparable financial harm”, she said.
Rao’s petition also raised concerns about corporate governance and transparency. She noted that REL’s AGM was scheduled before the competing offer was revealed.
She argued:
“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.”
She requested the court to direct the Securities and Exchange Board of India (SEBI) and the RBI to evaluate the competing offer. She also sought a stay on the Burman family’s acquisition until a fair review was conducted.
However, during the hearing, SEBI informed the court that the competing offer from Danny Gaekwad’s company had already been returned and was no longer valid. This meant that Rao’s request to stop the AGM was no longer relevant.
Senior Advocate Dr. Abhishek Manu Singhvi, appearing for one of the respondents, argued that Rao’s plea was influenced by Rashmi Saluja, a director of REL. He alleged that Saluja was using a minority shareholder to stall her own removal from REL’s board, as she was due to retire on February 7, 2025.
Singhvi claimed:
“This plea has been foisted by a disgruntled director, Rashmi Saluja, through a minority shareholder.”
Senior Advocate Aryama Sundaram, representing Rao, strongly opposed these allegations.
The case will be heard again on February 18, 2025.
Senior Advocate Aryama Sundaram, representing Rao, was assisted by Advocate Rohini Musa.
The respondents were represented by Senior Advocates Mahesh Jethmalani, Dayan Krishnan, and Nalin Kohli.
SEBI was represented by Senior Advocate Neeraj Malhotra
