InGovern, the proxy advisory firm, has recommended shareholders to vote against the reappointment of Rashmi Saluja as a Director on the board of Religare Enterprises due to the current turmoil in the company. The shareholders are set to vote on various proposals at the annual general meeting (AGM) scheduled for February 7.
The AGM was initially planned for December 31 but had to be postponed following a writ petition filed in Court. However, on January 9, the Court dismissed the petition, allowing the AGM to proceed. Despite this, Saluja has taken the matter to the Delhi High Court in an attempt to stop the vote on her reappointment at the AGM. InGovern expressed concerns about the abuse of power and corporate governance at Religare Enterprises due to Saluja’s repeated efforts to block shareholder votes.
Four independent directors of Religare have sought legal representation to challenge Saluja’s claims, hinting at potential collusion and ongoing investigations involving Saluja. The proxy firm noted a shift in the viewpoints of some independent directors regarding regulatory matters and highlighted internal conflicts, which could undermine shareholder confidence. The Court is set to hear the case on February 4.
The developments occur amidst a larger control battle in Religare, especially involving the Burman family’s attempt to increase its stake in the company from 25 percent. The Burman family has made an open offer of ₹2,116 crore to acquire an additional 26 percent stake, with the offer set to close on February 7.
Religare’s recent announcement of a counter offer from Danny Gaekwad, without proper due diligence, was rejected by SEBI. This move was viewed as a desperate attempt to derail the Burman family’s open offer, raising questions about corporate governance and leadership integrity at Religare. The resignation of key executives, including the Group CFO and senior managerial personnel, has also raised concerns about leadership stability and operational continuity at the company.
The lack of transparency in disclosing changes in independent directors’ views may lead to shareholder distrust toward management integrity. InGovern emphasized the importance of addressing these governance issues to restore shareholder confidence in Religare Enterprises.
