Burman family, the promoters of Dabur, completed the acquisition of an additional 26% stake in the financial services firm Religare Enterprises on Thursday, after a year-and-a-half-long tussle. Following the acquisition, the Burman family’s stake has increased to 51% and they will now be promoters of the financial services firm.
“As a result of the completion of the purchase of shares pursuant of shares...consequent to the change of control, the acquirers are the promoters of the target company,” said Religare in an exchange filing.
The stakes are acquired by four entities owned by the Burman family, including M.B Finmart, Puran Associates, VIC Enterprises and Milky Investment & Trading Company.
Post the acquisition, a Burman family spokesperson said the new leadership will focus on governance, shareholder value maximation and trust, and stability to drive sustainable growth of the Delhi-based financial services company.
“Governance, trust, and integrity will remain at the core of our vision as we steer REL towards a future defined by resilience and stakeholder value maximisation,” said a Burman family spokesperson.
What’s Next for Burman Family
While the Burman family’s path to lead the Religare Enterprises is now clear, it will now need to infuse funds worth Rs 5,000 crore to make the financial health of the Delhi-based company sound, according to the Mint’s report. Care Health, which is one of the key subsidiaries of the Religare Enterprises, recorded weaker results compared to its listed rivals.
“For driving Care’s growth and to address any losses, the promoters need to infuse capital...The Burman family may need to inject Rs 3,000-5,000 crore to kickstart the NBFC arm business and catalyze the growth of Care Health,” the Mint reported, citing a source.
Moreover, it’s not just Religare, where the Burman family will need to focus on. The Burman family’s own FMCG major witnessed a slow growth in the December quarter. The company recorded only a 2% increase in its consolidated net profits in Q3 to Rs 516 crore from Rs 506 crore in the same period of the last financial year.
The shares of Religare Enterprises climbed nearly 4% on the national stock exchange on February 21.
