US businessman makes counter offer for Religare at Rs 275 per share

Florida-based businessman Danny Gaekwad has made a counter offer in cash for Religare Enterprises at Rs 275 a share against Rs 235 apiece made by the Burmans of the Dabur group.

 

The offer was made in a letter addressed to the Chairperson of Securities and Exchange Board of India (Sebi), Religare told the stock exchange.

 

The letter, written by Danny Gaekwad Developments & Investments Florida, said its offer of Rs 275 per equity share represents a 17 per cent premium to the open offer price offered by the Burmans and a 24 per cent premium to the 60-day volume weighted average price of REL’s shares calculated with a reference date of September 22, 2023 of Rs 221.

 

“My proposed competing open offer will be for 26 per cent of the outstanding share capital of REL,” the letter said.

 

“I believe that the business of REL is robust and will do even better with a stable and committed promoter/investor that is able to provide adequate capital and undivided attention to the business. Unlike the Burmans, I do not have any other NBFC in our group and will be able to provide our undivided attention and infuse capital in the business,” Gaekwad said.

 

“Our proposed competing offer price of Rs 275 would provide a fair and reasonable exit opportunity to public shareholders in compliance with the letter and spirit of the SAST Regulations,” the letter said.

 

On Wednesday, the independent directors of Religare Enterprises had urged shareholders to take into account the low offer price of Rs 235 per share in the open offer made by the Burman family, which is attempting to acquire control of the company. They also raised concerns about the conditional approval granted by the Reserve Bank of India (RBI) for the offer.

 

The Burman family, owners of the Dabur Group, had made the offer price based on SEBI regulations after they acquired around 25 per cent stake from the market.  The Burmans open offer slated to open on Monday.

 

The letter said, the Burmans’ open offer price of Rs 235 per equity share grossly undervalues the real worth of REL and is to the detriment of public shareholders.

 

“At the time the offer was made on September 25, 2023, the offer price was already at a discount of 15 per cent to REL’s prevailing market price of approximately Rs 271 per share. Even considering the closing price of REL shares on January 22, 2025, the Burmans’ open offer price is at a steep discount of 7 per cent," the letter said.

 

“Further, the Burmans’ open offer is conspicuously silent on the nature of the approval granted by the Reserve Bank of India (‘RBI’) to such open offer on December 9, 2024. Such approval is available in the public domain and is clearly conditional on consolidation of multiple NBFCs within Burman group and Religare group as is evident from a bare perusal of paragraph 3(i) of such RBI approval letter dated December 9, 2024,” the letter said, asking the SEBI to grant permission to launch the counter offer.

 

Who is Danny Gaekwad?

 

Digvijay "Danny" Gaekwad is a first-generation American entrepreneur and community leader based in Ocala, Florida. He is the Founder and Chief Executive Officer (CEO) of NDS USA, an IT and cloud services company, and the Founder of Danny G Management, which owns and operates various restaurants and hotels. He also owns DG Hospitality, a hotel and restaurant management consulting company, and Danny Gaekwad Development & Investments, which oversees his real estate investments, according to the website of the University of Central Florida, where he serves as a trustee on the board.