Mumbai, Feb 14 : The Securities and Exchange Board of India (SEBI) has turned down a request from US-based businessman Danny Gaekwad to submit a competing bid for a controlling stake in Religare Enterprises Limited.
Gaekwad had proposed an offer that was 17% higher than the ₹235-per-share bid made by the Burman family of Dabur for a 26% stake in the company. His proposal aimed at acquiring a 55% stake in Religare. However, the Burman family dismissed Gaekwad’s bid as informal, pointing out that he had merely sought SEBI’s approval to make the offer and had entered the bidding process too late.
Earlier, on January 28, SEBI had returned Gaekwad’s request for permission to launch a competing open offer, ruling that his appeal did not qualify for exemption under securities law regulations. Despite legal challenges in the Delhi High Court and the Supreme Court, Gaekwad made another attempt by approaching SEBI and the Reserve Bank of India for approval. The Supreme Court had even directed SEBI to expedite its decision on the matter.
In a fresh ruling, SEBI’s whole-time member, Ashwani Bhatia, reaffirmed the regulator’s stance, rejecting Gaekwad’s request once again.
“It is noted that although the price offered by the applicant in the proposed competing open offer is ₹275 per equity share (a premium of ₹40 per share over the Burman Group’s offer), the applicant has failed to demonstrate his ability to meet the financial obligation required for making the competing open offer,” Bhatia stated in the order.
He further emphasized that allowing such an exemption would not serve the best interests of Religare’s shareholders. Bhatia noted that a competing bid without adequate financial backing could disrupt market stability and erode investor confidence.
“In view of the above, I do not deem it fit to grant the exemptions as sought by the applicant,” he concluded.( With inputs from IANS)