Mumbai: The Burmans, who own consumer-goods major Dabur and are the biggest shareholders of Religare Enterprises, have sought the cancellation of stock options worth ₹350 crore granted by Care Health Insurance to Religare chairperson Rashmi Saluja, intensifying the dispute between the management of the company and one of India’s most prominent business families. Care Health is a Religare subsidiary and Saluja is the non-executive chairperson of Care Health.

The Burmans have threatened the Care board that if it fails to nullify the employee stock options, then legal action will be taken against the directors, including attachment of their personal assets.

“Given the acquirers (Burmans) are significant shareholders of REL, holding 25.94% of shares, the board’s act of illegally ‘gifting’ these options to Rashmi Saluja has caused the acquirers a material loss,” said the Burmans in their March 12 letter to Care. Saluja-led Religare, on the other hand, has sought intervention by the market regulator Securities and Exchange Board of India in the matter.

Email queries sent to the Burman family and Religare didn’t elicit any response until the publication of this report.

The Burman family’s open offer to buy additional shares from public stockholders and boost its equity ownership in Religare has allegedly been opposed by its board. The Burman family recently sought the regulators’ intervention in the open offer matter, alleging it faced a “complete absence of cooperation and support” from Religare about acquiring certain information to complete the applications necessary to obtain regulatory approvals.

While the approval for the deal is pending before the central bank, the capital-markets watchdog and the insurance regulator, the competition regulator gave its nod on January 23.Soon after the Competition Commission of India’s approval, the Burmans raised their ownership in Religare to 25.18% from 21.18%. This new shareholding level gives the Burmans the right to block special resolutions at Religare and make an open offer for an additional 26% to the company’s public shareholders.The Burman family’s open offer to buy additional shares from public stockholders and boost its equity ownership in Religare has been opposed by its board.

The Burmans alleged that 22.7 million stock options, constituting 1.25% of the share capital of Care, were wrongfully granted to Saluja in January 2022.

Four months later, in May 2022, insurance regulator IRDAI disapproved the grant of options to Saluja on the grounds that her role and responsibility as a non-executive chairperson were largely similar to those of a non-executive director and that the remuneration should be in line with such a role.

However, the board of Care sought legal opinion and based on that, gave her stock options as an employee of Religare Enterprises and not in her capacity as non-executive chairperson of Care.

The board of Religare, in the past, said that the ESOP issuance was in full conformity with the insurance regulator’s rules. The Burmans have asked the board to restrict any further exercise of stock options of Care by Saluja.


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