orpea logo (photo credit: orpea / )
(AOF) – Orpea increased by 7.25% to 1.048 euros after the Paris Court of Appeal confirmed this Thursday the decision of the Financial Markets Authority (AMF) authorizing the Caisse des Dépôts et Consignations to increase its capital of the operator of retirement homes and clinics Orpea without launching a public takeover offer. The court claims to have validated this exemption “in order to preserve the useful effect of the European directive which is at the origin of the accelerated safeguard procedure and to facilitate the restructuring of companies facing financial difficulties”.
The company indicated on Monday that the launch of the first of three successive capital increases planned as part of its financial restructuring was “projected in the coming days, subject to the decision of the Paris Court of Appeal”. This obstacle has been removed.
The financial restructuring plan, which should lead to a change of majority shareholder and the erasure of part of Orpea’s debt, provides for a massive dilution of existing shareholders.
“At the end of these operations and in the absence of reinvestment, they would hold approximately 0.04% of the capital, the theoretical value of the share being less than 0.02 euros in this context,” had the company said on Monday.
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Key points
– European number 1 in global dependency care with more than 90,000 beds and nearly 1,000 establishments in 21 countries, created in 1989;
– Turnover of €4.7 billion, split between France-Benelux for 60%, Central Europe for 26%, Eastern Europe for 9%, the Iberian Peninsula and Latin America ( Brazil, Chile and Uruguay) for 5% then China;
– Questioning the value creation model (international growth and strong ownership, at 46%, of operating real estate assets) following criticism of resident care;
– Very tight balance sheet with leverage (net debt / pre-IRFS 16 EBITDA) greater than 25x at the end of 2022, requiring a restructuring of the debt and contributions of new funds through guaranteed debt and capital increase.
Challenges
– Refoundation plan “Orpea changes with you and for you” 2025:
– association of stakeholders in the overhaul and improvement of medical practices,
– recovery in performance: 9% annual revenue growth and operating margin of +12%,
– sales of real estate assets (€1 billion identified), restructuring or sale in countries without an attractive position and financial restructuring;
– Strategy of innovation and anticipation of care for all vulnerabilities;
Challenges
– Strong impact of inflation on food and energy consumption, electricity purchases in France not being covered;
– Implementation of the financial restructuring project as part of the accelerated safeguard procedure opened on March 24, 2023;
– Attitude of shareholders and creditors, the restructuring involving the capitalization of unsecured debts held by the latter to the tune of €3.8 billion and a capital increase from €1.3 to €1.5 billion;
– Interest from numerous funds: Mat Immo Beaune, Nextstone.
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