Orpea: The restructuring of Orpea agreed somehow, the action crashes

(BFM Bourse) – Shareholders and debt holders approved by majority, but not unanimously, the financial rescue plan for the operator of nursing homes. The company will request the commercial court to apply the protection plan.

The consultation of the “classes of affected parties” (that is, the creditors and the shareholders) on the financial restructuring plan of Orpea has not been full board. These classes, nineteen in number for the creditors, in addition to those of the shareholders, had to decide on Wednesday about this plan for the group of elderly homes that are currently in the accelerated security procedure.

According to the results of the votes announced by the company, six of these ten classes approved the draft accelerated protection plan with the required majority (more than two-thirds), three others, including those of shareholders, supported the draft backup plan accelerated by more than 50% . For the shareholders, “yes” won by a thread (50.8%).

And on the contrary, holders of Oceane bonds (convertible bonds that can be exchanged for new or existing shares) rejected this plan to 50.8%.

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A plan that could be completed in the second half of 2023

To the extent that not all the classes have approved this plan, Orpea will in the coming days request the Commercial Court of Nanterre for the decree of the protection plan accelerated by “coercion between classes”. This procedure allows the justice to apply this type of plan even if not all classes have given the green light.

This under certain conditions. For example, as a Senate information report explains, the plan must be approved by classes other than the capital owners, which is also the case here.

If the court considers that the legal conditions are met to implement this application, Orpea will be able to complete its financial restructuring, which is planned for the second half of this year.

“To the extent that the draft accelerated protection plan has not been approved by all groups of parties affected by the required majority, and in the event that the plan is stopped by the court, the existing shareholders should hold after the implementation of the capital increases and in the absence of reinvestment, approximately 0.04% of the company’s capital”, emphasizes Orpea. In other words, the dilution would reach 99.96%. “The theoretical value of the action would also come out to around 0.02 euros,” the group adds.

On the Paris stock exchange, Orpea shares fell again, losing 15.6% to 1.87 euros around 00:00.

Negative equity

As a reminder, the financial restructuring of the group allows for debt relief of almost 4 billion euros as well as the takeover of the company by a group of investors led by the Caisse des dépôts et consignations (CDC).

On Friday night, the group had published two reports published by the Ledouble cabinet, which valued the company between 6 billion and 7 billion euros in continuity of operations and between 2.6 billion euros and 3.7 billion euros in liquidation.

After the rise in the title – which had taken more than 30% on Monday at the beginning of the session – the group then gave details, stressing that these estimates related to a value of companies and not to equity capital.

Which simply means that, in light of the evaluations of the Ledouble cabinet, the value of the company’s equity is largely negative, given that at the end of December 2022 the group had a gross debt of 9.7 billion euros…

Julien Marion – ©2023 BFM Bourse

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