The Burman family has refuted the allegations of their activities as being "fraudulent and illegal" by independent directors of Religare Enterprises Ltd (REL), terming them " false, frivolous and defamatory".
The Burman family, which had made an open offer in September to acquire Religare Enterprises' control, in a statement said: "We are surprised and disappointed at these allegations."
Burmans said it will move towards closing the transaction “expeditiously”, working with all the regulators.
Over the allegation of fraud and other breaches, the Burman family said some of these statements are being "orchestrated as falsehoods" by interested persons at REL.
"We have purchased all our shareholdings in REL through transparent market purchases and preferential allotments in prior fund-raising exercises approved by the Board of REL. There is no market manipulation whatsoever," the statement said.
Burman family, a promoter of Dabur India and other entities such as Eveready Industries, through its entities had in September announced a Rs 2,116 crore open offer to the shareholders of REL to acquire up to 26 per cent stake in the company.
The open offer was made with the intention to increase the family's stake and take control of REL.
Post the offer, the Burman family's stake in the financial services firm is expected to increase from about 21 per cent at present to 51 per cent.
"The Burman family and its members satisfy all norms of fit and proper criteria mandated by financial services regulators and this allegation is baseless and devoid of any merit," the statement said.
According to news reports, the Securities and Exchange Board of India (Sebi) has sought evidence and documents from REL to back the allegations, made in an October 18 letter.
Sebi has also sought the response of JM Financial, which is managing the open offer on behalf of the Burman family, over the allegations made by independent directors.
Responding to the allegations, the Burman family said: "We remain hopeful that independent directors will not be misled or instigated into such false conclusions by certain senior executives and would refrain from doing so without first having examined facts or going through a due process."
"At this stage, we are concerned that some of these statements are being orchestrated as falsehoods by interested persons at REL.
"We would urge the independent directors to review the issues with proper facts and records in perspective as per well-established procedures that boards of listed companies ought to follow," the statement said.
Burmans also alleged that some of these allegations were being made because it drew the attention of the company through a letter to the board of REL, to certain share trades by a certain senior executive at REL immediately prior to the launch of its open offer.
"We are concerned that instead of dealing with the legitimate queries raised in our letter of October 26, 2023, the attention of regulatory authorities / Board / public shareholders is being deflected to such falsehoods," it said.
Moreover, Burmans also said REL shareholders had sought some improved governance primarily relating to limiting the high compensation of a specific individual which is in excess of approx Rs 150 crore, an amount which is not in line with compensation norms by any reasonable parameters.
"For now, keeping the overall shareholder interest in mind, we will move towards closing the transaction expeditiously working with all the regulators as has always been our approach," it said.
In August, the Burman family had increased its stake in Religare Enterprises to 21 per cent from 14 per cent by buying shares of the diversified financial services company, aggregating 7.5 per cent, from the open market.
