Care Health throws a challenge to insurance regulator on Saluja’s hefty Esops

livemint.com:

MUMBAI : The controversy over Care Health Insurance Ltd’s award of hefty stock options to its chairperson Rashmi Saluja has taken a turn that may further delay the billionaire Burman family’s bid to take over the company’s parent entity, Religare Enterprises Ltd. In a move that may spark a fresh legal tussle, Care Health has argued against the insurance regulator’s powers over stock options granted to anyone in an Indian insurance company.

Last week, Care Health wrote to the Insurance Regulatory and Development Authority of India that no action should be taken against the company for awarding equity stock options (Esops) to Saluja despite the regulator rejecting its proposal. Irdai’s approval was not “not required" for granting the Esops, Care Health said in its letter, which Mint has reviewed.

The letter was in response to a 14 June show-cause notice by Irdai asking why Care Health should not be penalised for granting Esops to Saluja despite the regulator’s rejection. Saluja’s stock options from Care Health, issued in 2022, are worth at least ₹250 crore, as per the last valuation of the company’s shares.

The Burman family, which owns over 25% in Religare, has alleged in a complaint to Indian financial regulators that Saluja was drawing an excessive remuneration worth over ₹450 crore by granting herself bulky stock options from Care Health and Religare, both of which are chaired by her. On 13 May, the Burman family, which owns consumer goods major Dabur India and other firms, warned Care Health of legal consequences if it did not act to prevent Saluja from cashing out the stock options.