Apply for open offer by July 22: SAT to Religare

The Securities Appellate Tribunal (SAT) on Wednesday directed Religare Enterprises to comply with the Securities and Exchange Board of India’s (Sebi’s) order and seek all regulatory and statutory approvals for the Burman family’s open offer by July 22.

A bench, led by Justice Dinesh Kumar, also asked Sebi to file a reply as well as a rejoinder in four weeks. Further, there will be no coercive action against the company till August 29, the date for next hearing, it said. 

SAT also allowed Burman family entities MB Finmart and others to file intervention applications in the matter. MB Finmart had sought to be impleaded as a party in the matter.

The directions came on an appeal filed by Religare Enterprises challenging an interim order-cum-show cause notice issued by Sebi. The regulator had asked the management and the board of the company to apply to all regulators for approval for the Burman family’s open offer by July 12.

Religare, which operates in the non-banking, insurance, and broking segments, needs approvals from the Reserve Bank of India (RBI) and the Insurance Regulatory and Development Authority (IRDAI) in addition to Sebi.

The Burmans, who hold 26% in Religare, had alleged that the Religare board and chairperson Rashmi Saluja were blocking the open offer by contending that the Burman family was not “fit and proper” for the acquisition.

Sebi had reprimanded Saluja and the board for failing to comply with the Substantial Acquisition of Shares and Takeovers (SAST) regulations after the Burman family launched an open offer to acquire additional shares in the financial services conglomerate.

The regulator had said in the order that it was left with no other option but to issue urgent directions to the noticees to take appropriate steps since the target company Religare Enterprises had refused to take appropriate steps for making applications to regulators for statutory approvals. Sebi had also asked Religare, Saluja and five others to explain why they should not be barred from capital market activities.

On Wednesday, shares of Religare Enterprises closed at Rs 238.25, down 2.14%. Burman Group entities had made a public announcement in September last year to acquire shares representing 26% of REL’s expanded voting share capital at a price of Rs 235 each.