The Securities and Exchange Board of India (SEBI) has rejected Danny Gaekwad’s competing offer for a stake in Religare Enterprises Ltd. (REL) due to procedural violations and concerns over financial credibility. SEBI’s decision comes after a detailed review of Gaekwad’s application, which was filed after the regulatory deadline and failed to meet financial requirements.
Religare Enterprises Ltd. is a listed Core Investment Company (CIC) with no identifiable promoter. The Burman Group, already holding 21.54% equity in REL, had proposed to acquire an additional 5.27% stake at ₹235 per share on September 25, 2023. This acquisition triggered an open offer under SEBI’s Substantial Acquisition of Shares and Takeovers (SAST) Regulations, 2011. The offer period was set between January 27, 2025, and February 7, 2025 after obtaining all necessary approvals.
On January 24, 2025, Digvijay Laxhamsinh Gaekwad approached SEBI seeking permission to make a competing offer for 55% of REL at ₹275 per share. However, SEBI initially rejected the request due to procedural non-compliance. Gaekwad then formally submitted an application on February 1, 2025, which was still outside the regulatory deadline specified in Regulation 20(1) of SAST Regulations.
Meanwhile, a shareholder named Sapna Govind Rao filed a writ petition in the Delhi High Court on February 4, 2025, seeking a stay on Burman Group’s offer. The matter escalated to the Supreme Court of India, which directed Gaekwad to deposit ₹600 crores by February 12, 2025, for SEBI to consider his competing bid. However, Gaekwad failed to deposit the required amount, raising concerns about his financial capability.
After reviewing the case, SEBI ruled that:
- Gaekwad’s competing offer was filed after the deadline set by SEBI’s takeover regulations.
- The failure to deposit ₹600 crores as directed by the Supreme Court raised financial credibility concerns.
- Allowing an untimely competing bid could lead to market instability and harm investor interests, particularly those who had already tendered their shares under the Burman Group’s offer.
SEBI officially rejected Gaekwad’s exemption request, stating that his offer lacked financial backing and appeared to be aimed at delaying Burman Group’s acquisition. With this decision, the Burman Group’s takeover bid will proceed as planned.
