Religare Enterprises initiates governance review, seeks funding support from Burman Group

Religare Enterprises Limited (REL) has commissioned a governance review of its operations and subsidiaries, Religare Finvest Limited (RFL) and Religare Housing Development Finance Corporation Limited (RHDFCL). The board of Religare Enterprises has also decided to approach the new promoters, the Burman Group, for immediate funding support to sustain the operations.

Religare Enterprises, in an exchange statement, says for conducting this review, its board will engage law firm Trilegal, which would be assisted by Grant Thornton Bharat LLP.

The law firm aims to review operating practices and also identify "instances of misconduct" by employees of these companies. "The objective is to review the past operating practices, suggest improvements around systems & controls for future implementation and to identify any potential instances of misconduct by certain current and/or ex-employees of the aforementioned companies," the company says in an exchange filing.

Further, the Religare board says it reviewed the fund flow position of the company and observed a cash flow gap over the next few months. "After examining the various options, the Board has unanimously decided to approach the new Promoters, the Burman Group, for immediate funding support to sustain the operations of the Company."

To address the funding requirements, the board has recommended a short-term Inter Corporate Loan (“ICL”) from the Promoter Group or its Associate Entities. The company says in the interim, they will be best suited, given the tight timeline for the requirement.

The Burman family, which owns Dabur, acquired a majority stake in the Delhi-based financial services firm on February 21, 2025. The Burman group’s shareholding in Religare Enterprises rose to 25.16% after acquiring an additional 0.07% equity via an open offer.

The Burman family, which started acquiring stakes in the company in 2018, is the single largest shareholder in the company and holds a stake through its four group entities -- M.B. Finmart Private Limited, Puran Associates Private Limited, VIC Enterprises Private Limited, and Milky Investment & Trading Company.

The company has appointed Praveen Kumar Tripathi as the chairperson of the company after the exit of Saluja as she did not get approval from shareholders for her re-appointment. Tripathi, a non-executive independent director, will serve the company until June 30, 2025.

The Burman group entities in September last year had proposed an open offer to acquire an additional 26% equity stake in the diversified financial services group at a floor price of ₹235 per share, amounting to ₹2,116 crore, payable in cash. All four entities had jointly announced an open offer to acquire up to 90,042,541 fully paid-up equity shares of the Mumbai-based firm. This was largely aimed at getting majority control in the company.

However, the Religare management raised concerns regarding the offer, questioning the "fit and proper" credentials of the Burman family and criticised the offer price, which was significantly lower than then current market price. Burmans, on the other hand, alleged the Religare management was obstructing it from acquiring more stakes.

The legal battle reached various courts and at the end the RBI and the SEBI approved the offer in December last year, which was launched by the Burman family on January 27.

The high-stakes battle for the control of Religare took another twist with Florida-based businessman Danny Gaekwad getting an extension from the Supreme Court to deposit ₹600 crore for his competing offer to acquire a stake in the company. On February 7, the SC had extended by 5 days the time for the Burman family's open offer for an additional stake in REL. However, Gaekwad failed to deposit the funds by February 13, citing paucity of time. As a result, the Burmans finally win the battle.