Orpea: Orpea shareholders are speaking out against the group’s restructuring plan

(BFM Bourse) – The retirement home operator is losing ground on Thursday after jumping over the last three sessions. Orpea made an update and recalls continuing its discussions with its creditors. Concert’o, a group of activist shareholders, remains opposed to the restructuring plan as presented by Orpea.

The TV series Orpea takes a new turn after the recent surge in the title. In a press release issued Wednesday evening after the stock market, the operator of retirement homes recalls that the next capital increases will lead to massive dilution for existing shareholders who decide not to participate. The content of the letter fromOrpea confirms the fears of Concert’o – the concert bringing together investors Mat Immo Beaune and Nextstone Capital – which opposes the financing plan aimed at a “massive dilution of shareholders” of the operator of retirement homes.

The title Orpea starts to fall again and yields 14% this Thursday around 10:30 a.m. Over the last three sessions, it had experienced strong growth of more than 30%.

The recent rebound of the title would be linked to possible redemptions of short positions but above all to speculation concerning an investment by the Caisse des dépôts to help the operator of retirement homes in difficulty since the publication of the book-investigation The Gravediggers last year.

A tune-up after the stock’s recent rise

“Faced with the unusual movements observed on its share price in recent days”, the operator of retirement homes wished to make an update in a press release issued Wednesday evening after the market. Orpea recalls that “in accordance with the announcements made in the press releases at the end of last year, the group is engaged in the negotiation of a drastic financial restructuring”.

Undermined by the inflation of its costs and weighed down by its heavy debt, the operator of retirement homes announced last November a major financial restructuring. This plan provides for fundraising of nearly 6 billion euros, including approximately 600 million euros in new debt guaranteed on assets and more than 5 billion euros in capital.

An “unfair” restructuring plan for Concert’o

Gold, Orpea recalls that “the implementation of these capital increases will result in massive dilution for existing shareholders who decide not to participate”. A position that did not fail to arouse the ire of Concert’o, the concert bringing together the activist shareholders Mat Immo Beaune and Nextstone.

Claiming more than 5% of the capital ofOrpea, this union of shareholders has stepped up. Concert’o also issued a press release that same Wednesday evening. The second shareholder of the operator of retirement homes recalled his fight to preserve the interests of shareholders, called to be sacrificed by imposing an “unfair” restructuring plan on them.

“Property of its shareholders, who are the co-owners, Orpea must not be scuttled in public. Publishing a press release to scare its investors, by putting forward an iniquitous restructuring plan, even though none of the affected parties has endorsed it, is unacceptable to say the least”, is moved Concert’o.

Concert’o had for its part proposed an alternative plan which “would make it possible to maintain good relations with the creditors of the company whose debt would be reimbursed through the realization of the plan of sale of assets projected within the framework of the first conciliation”. This plan would preserve the interests of shareholders because it would “also avoid a massive and immediate dilution of current shareholders by guaranteeing them the maintenance of their preferential subscription rights”.

On his side, Orpea indicates that discussions are still ongoing with its financial creditors and third-party investors within the framework of the amicable conciliation procedure opened by the president of the specialized commercial court of Nanterre, under the aegis of the conciliator. “The company cannot give any guarantee on the outcome of these discussions”, recalls the group whose stock fell 93% in 2022.

Sabrina Sadgui – ©2023 BFM Bourse

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