 "Religare Enterprises climbs 4% in morning deals but pare gains; here's why")
Religare Enterprises shares slipped 3.1 per cent in trade on Monday after gaining 4.2 per cent in the morning deals. The stock moved after the company announced to go ahead with an open offer, after claiming that the counter offer made by US-based businessman Digvijay Gaekwad wasn’t valid and would not stand the scrutiny of market regulator Securities and Exchange Board of India (Sebi).
Around 11:10 AM, Religare share price was down 2.11 per cent at Rs 244.1 per share on BSE. In comparison, the BSE Sensex was down 0.98 per cent at 75,442.75. The market capitalisation of the company stood at Rs 8,070.08 crore. The 52-week high of the stock was at Rs 319.90 per share and the 52-week low was at Rs 201 per share.
The Burman family claimed that the competing offer falls outside the 15-day window stipulated by the Sebi takeover code, following their initial offer on October 4, 2023.
“In his correspondence, he has only made a Request for Permission to the Sebi seeking their permission to make a competing open offer. Gaekwad had to make the competing offer, if at all, within 15 days from the date of public statement, which was made by the Burman Group on October 4, 2023, but he did not do so,” the statement by the Burmans said.
The Burmans’ open offer at Rs 235 a share opened today. Gaekwad sought Sebi's permission to launch an all cash offer to buy 55 per cent of Religare's stake from its shareholders at a price of Rs 275 a share. The entire stake buy exercise will cost Rs 5,000 crore to Gaekwad.
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It was a significant 17 per cent premium above the Burman family offer of Rs 235 apiece. The Burmans had made the open offer after they acquired approximately 25 per cent stake in Religare. The board, however, has said the Burman offer is too low and has asked shareholders to carefully consider their options.
In the past one year, Religare Enterprises shares have gained 10 per cent against Sensex's rise of 5.9 per cent.