Madhya Pradesh High Court lifts stay on Religare Enterprises' AGM

The order clears way for the open offer by Burman family

The Madhya Pradesh high court on Thursday disposed of a public interest litigation (PIL), lifting the stay on the annual general meeting (AGM) of Religare Enterprises (REL), which was earlier scheduled for December 31.

 

The court noted that the petitioner was not a shareholder in the company and was not aggrieved in the impugned order.

 

The AGM was stayed by an order by the high court dated December 18, 2024 after the PIL filed by advocate Vijayant Mishra sought an independent commission of enquiry to monitor the acquisition of the company by the Burman family.

 

The court’s decision gives way to the open offer by the Dabur promoters, which has already received the approval from the financial regulators. The success of the open offer will lead to the transfer of the management control to the Burman family.

 

 

Further, with the lifting of the stay on the AGM, key agenda items such as the reappointment of Rashmi Saluja as a director can now be taken up.

 

Shares of REL rose over 4 per cent, closing at Rs 294 apiece on Thursday.

 

Solicitor General Tushar Mehta, who was representing the Reserve Bank of India (RBI), argued that while the company was Delhi based, the plea was filed in Madhya Pradesh. He added that the petitioner was not a shareholder in REL.

 

Mehta added that in case of intra-shareholder dispute, a PIL was non maintainable and that the affected parties had taken remedies under the Company Law.

 

Meanwhile, Senior Advocate Amit Anand Tiwari representing REL and Senior Advocate Mukul Rohatgi for Saluja were seeking more time to file response in the matter.

 

While disposing of the matter, the bench allowed the petitioner to approach an appropriate forum for the matter.

 

REL had earlier deferred its AGM by three months to December 2024 from September 2024. The deferment was criticised by proxy advisory firms and corporate governance experts.

 

Four entities owned by the Burman family in September 2023 purchased an additional 5.27 per cent stake through the open market. This triggered an open offer as they already held a 21.54 per cent stake in the financial services firm. The Burman family had announced the open offer to acquire an additional 26 per cent.

 

Currently, the Burman family is the single-largest shareholder in Religare, but has no board representation. Religare had filed for the nod from regulators for the open offer in August this year, following directions by the Securities Appellate Tribunal (SAT).