French care home scandal hits Orpea and Korian shares again

[June 08, 2022]  By Sudip Kar-Gupta

PARIS (Reuters) - French police raided the headquarters of Orpea on Wednesday, investigating allegations of mistreatment at its care homes, while shares in rival Korian dropped after a newspaper report it could face legal action over the way it managed its homes.

Shares in both companies have taken a beating since January, when an investigative journalist published a book alleging there had been severe failings in care at an Orpea nursing home in a wealthy Paris suburb.

At 0840 GMT, Korian shares were down 8.9% and Orpea's were 4.7% lower, the two worst performances on France's SBF-120 equity index.

Orpea confirmed the police raids, but declined further comment.

French daily Le Parisien reported a lawyer acting on behalf of relatives of former residents of Korian facilities in France was planning to file complaints against the company.

Korian said it had not been contacted by the lawyer and so could not make any comment.

"We make sure that every serious situation brought to our attention is duly reported to the authorities," it said in a statement.

The French government said in March that following an investigation it planned to file a criminal complaint against Orpea over the allegations of mistreatment of elderly patients.

Orpea responded at the time by saying that while the government report "does shed light on certain dysfunctions", it also "allows us to conclude that there is no organised 'system' that would lead to widespread abuse".

Since the start of the year, Orpea's and Korian's shares have plunged 72.6% and 38.8% respectively, versus a decline of 9% for the SBF120.

(Reporting by Sudip Kar-Gupta and Tassilo Hummel; Editing by Emelia Sithole-Matarise and Mark Potter)

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