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The
prosecutor's office said it had registered around 50 complaints
relating to "institutional mistreatment" of elderly residents.
An Orpea spokesperson confirmed the raids and said the company
was cooperating with the investigators.
This follows the publishing early this year of a book by
independent journalist Victor Castanet, relating to Orpea. The
book, "Les Fossoyeurs," or The Gravediggers, sent shock waves
through France and much soul-searching over how the elderly are
treated in nursing homes.
Orpea said in June that an independent audit had found evidence
of financial wrongdoing, including inflated labour expenses and
suspiciously large payments to third parties, although it did
not back up the accusations made in the book. It has rejected
allegations of widespread maltreatment.
"We cooperate fully with judicial authorities on all these
subjects," CEO Laurent Guillot told analysts on a conference
call.
The raids took place as Orpea, one of Europe's biggest
for-profit care home groups, was telling investors on Tuesday
that it would scale back its international activities and focus
on its core business.
In October, the retirement group had warned of asset impairments
and said it had requested talks with creditors.
Orpea is considering the conversion of 3.8 billion ($3.9
billion) euros of unsecured debt into equity through a rights
issue to existing stakeholders, backstopped by lenders based on
their claims, the group said on Tuesday.
It also hopes to bring in 1.9-2.1 billion euros of additional
cash through new secured debt of 600 million euros to cover its
funding needs until early summer 2023, and a second capital
increase, the terms of which were not disclosed.
With gross debt of 9.53 billion euros at the end of September,
Orpea said it expects that following these transactions, at
least 20% of its share capital will be held by long-term French
institutional investors.
The group also targets annual revenue growth of 9% by 2025, with
an operating profit margin above 20% and core earnings of about
745 million euros that year.
(Writing by Diana Mandiá and Ingrid Melander; Editing by Kirsten
Donovan and Bernadette Baum)
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