Sep 25, 2023
India’s Dabur Owner Seeks Stake in Financial Services Firm Religare
Bloomberg News
,(Bloomberg) -- The Burman family that controls consumer-goods maker Dabur India Ltd. is raising its stake in Religare Enterprises Ltd. as the conglomerate seeks control of the financial services firm amid an ongoing diversification spree.
The family, which is already the single largest shareholder in Religare with little over 21% stake, plans to acquire another 5.27% for 4.07 billion rupees ($49 million) through four of its firms, according to an exchange filing Monday. The Burmans have also offered to buy as much as 26% from the minority shareholders, as part of a mandatory open offer that was triggered under the Indian securities law.
“The open offer is made with the intention to increase the family’s stake and take control” of Religare, the Burman family said in a statement. Burman Family Holdings is focused on investment opportunities primarily in the health care, financial services, hospitality, education and media sectors, according to its corporate website.
The open offer price of 235 rupees a share — an almost 14% discount to Religare’s closing share price on Friday — however, may find few takers. The stock fell as much as 7% in Mumbai trading after the announcement.
The 139-year-old Burman Group, which has plowed over $500 million investment in the past two decades, is doubling down on its diversification spree as it pivots beyond its staple consumer businesses of making soaps, toothpastes and Ayurvedic health supplements. The conglomerate has invested in battery-maker Eveready Industries, two insurance providers as well as helped set up fast-food chain Taco Bell in India in the past few years.
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“The proposed transaction is in line with our vision to create a leading financial services platform that encompasses lending, broking and health insurance services,” Anand. C. Burman, chairman emeritus at Dabur India said in the statement.
The open offer made by Burman Family does not require any minimum number of Religare shares to be tendered by the investors, the filing said.
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