Religare Takeover Battle: Sebi Takeover Code Under Test
Why in the news
The fight over Religare Enterprises became a test of India’s takeover rules, drawing in regulators, investors and the Supreme Court.
Key facts
- Open offer: by the Burman Group for a controlling stake.
- Rival: Florida-based investor Digvijay ‘Danny’ Gaekwad, who bid in January 2025.
- Price: ₹275 per share, 17% above the Burman bid.
- Sebi: rejected the counter-bid for breaching the takeover code: no proper timeline, no merchant bankers, no formal process.
- Supreme Court: permitted the bid after a ₹600 crore deposit as proof of financial backing.
Timeline
| Step | Event |
|---|---|
| 1 | Burman open offer |
| 2 | Gaekwad’s higher counter-offer |
| 3 | Sebi rejection |
| 4 | Supreme Court allows bid on ₹600 crore deposit |
Questions raised
- Strict compliance versus competitive bidding: should tight procedure block serious rival offers?
- Proof of funds: the ₹600 crore deposit stresses financial credibility.
- Delays: time may distort valuations and discourage rival offers.
- Governance: Rashmi Saluja was removed from the board, signalling a shift in control.
Exam angle
- Regulator: Sebi; rules: Takeover Code.
- Company: Religare Enterprises.