2024-10-03 09:09:06
New Delhi: The Board of Directors of Care Health Insurance Limited (CARE) recently rejected the Burman family’s demand for the removal of Chairperson Dr. Rashmi Saluja. The decision was taken at the health insurer’s annual general meeting (AGM) on Monday. The Burman family is the largest shareholder in Religare Enterprises Limited (REL). REL holds 64 per cent stake in CARE. The board said in its statement that it reviewed the letter sent by the Burman family to remove Saluja. In this, reference was made to the insurer’s articles of association and the ongoing legal investigation.
Based on legal advice, the board concluded that there was ‘no reason’ to remove Saluja. In this way Saluja’s position became stronger. The company further said, ‘Appropriate response is being sent to the proposed acquirers.’
What was the argument of the Burman family?
In fact, the Burman family argued that the ongoing legal cases against Saluja make him ineligible to remain chairperson. These cases include investigations by SEBI and the Enforcement Directorate (ED) for insider trading.
The ED’s allegations also include allegations of filing false complaints against the Burman family. These are charges under sections 420 and 120B of the Indian Judicial Code (formerly the Indian Penal Code). Due to all this the family was putting more pressure on Saluja to remove him.
What does Rashmi Saluja say?
Despite legal pressures, Saluja defended his role. He has described the actions of the Burman family as part of a hostile takeover.
In a recent interview, Saluja had criticized the family for their sudden change of stance after supporting his leadership for years.
Saluja had said, ‘He praised and supported the management for six years. Now claim they love the company for its potential, while dismissing the people responsible for that success.’
The Burman family’s attempt to consolidate control over REL comes after their open offer to acquire an additional 26% stake in the company. It is a move that has increased tensions within the boardroom. REL’s controlling stake in CARE, coupled with the ongoing legal disputes, reflects the growing differences between Saluja’s leadership and the strategic aspirations of the Burman family.
Who is Rashmi Saluja?
Dr. Saluja comes from a medical background with multiple degrees like MBBS, MD, PhD, MBA and LLB. He took up the challenge of reviving Religare in 2018. He was initially appointed as an additional non-executive independent director. In 2019, he was elected as the Executive Chairman of Religare Enterprises. Dr. Saluja’s entry into the corporate world was unexpected. But, his expertise and vision inspired him to take on this challenge.