Convulsed since the launch in January of the work of the journalist Víctor Castanet, the gravediggers, The group of accommodation establishments for dependent elderly people (Ehpad) private Orpea announced this Wednesday that it had opened a new friendly conciliation procedure before the commercial court of Nanterre, in order to renegotiate its debt with its creditors.
“The company is too indebted due to real estate and international development carried out at a frenetic pace, at the initiative of the former general management”explained to Agence France-Presse (AFP) its new CEO, Laurent Guillot.
“This friendly conciliation procedure allows us to renegotiate with financial actors the situation of our debt and, at the same time, protect our employees and residents”, he added. The intended goal would be “turn some of Orpea’s debt into equity and again raise money in debt and equity from investors”Mr. Guillot said.
Orpea had already carried out a friendly conciliation procedure this year that had allowed it to reach an agreement with its banks to secure its financing. But the group may no longer be able to comply due to various factors, such as inflation. Orpea also anticipates further asset write-downs, estimated at between €2.1bn and €2.5bn, according to a press release. Orpea’s situation has also been “strongly affected by the prevarication and the ethical lapses of the previous administration”Mr. Guillot insisted.
Three-year group transformation plan
The group has decided to complete the complaint against X already filed in court, this time explicitly directed at the former corporate director, Yves Le Masne, explained Mr Guillot. “I don’t imagine for a moment that Yves le Masne (…) he did not measure all the responsibility that was hisMr. Guillot commented.
Orpea is present in 23 countries and manages more than 350 establishments in France. In the research book. the gravediggersthe group is accused of mistreatment of residents, accounting fraud and questionable human resource practices.
Justice opened a preliminary investigation in April for institutional mistreatment and financial crimes, following a government report. The group says it has taken steps to change its practices and plans to detail its three-year transformation plan on November 15.
At the end of September, Orpea announced that he wanted “taking better care of residents, employees and caregivers through an ambitious recruitment and continuing education program”. It plans to hire 550 people per month by the end of the year, half of whom are nursing assistants. His goal is to increase to 800 monthly hires in 2023.
Since the scandal, his stock has plummeted on the Paris Stock Exchange. The stock, whose course was suspended on Monday, was trading on Friday at the close of the session at 14.74 euros, a drop of 83% since the beginning of the year. But last week, the share price soared 37%, with no major news or announcement to explain it. The stock gained around 10% during each of the first three sessions of the week. Analysts interviewed by AFP had hypothesized the withdrawal of bearish bets as a possible explanation, although they remained cautious. Trading will resume on Wednesday when the markets open.
The group posted a net loss of 269 million euros in the first six months of the year, weighed down by inflation and asset write-downs.
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