"The company is too indebted due to the international and real estate development carried out at a frantic pace, on the initiative of the former general management", explained to AFP its new general manager, Laurent Guillot.

"This amicable conciliation procedure allows us to renegotiate with the financial players the situation of our debt and at the same time to protect our employees and residents", he added.

The envisaged objective would be to "convert part of Orpea's debt into equity and again raise money in debt and equity from investors," said Mr. Guillot.

Orpea had already carried out this year an amicable conciliation procedure which had enabled it to reach an agreement with its banks to ensure its financing.

But the group may no longer be able to comply with it due to various factors such as inflation.

Orpea also anticipates further asset write-downs, estimated at between 2.1 and 2.5 billion euros, according to a press release.

Orpea's situation has also been "strongly affected by the embezzlement and ethical breaches of the previous management", underlined Mr. Guillot.

The group has decided to complete the complaint against X already filed with the courts, this time explicitly targeting the former corporate officer, Yves Le Masne, said Mr. Guillot.

"I do not imagine for a moment that Yves le Masne (...) did not measure all the responsibility that was his," commented Mr. Guillot.

Orpea, present in 23 countries and which manages more than 350 establishments in France, has been in turmoil since the publication in January of the investigative book "Les Fossoyeurs", which accuses it of mistreatment of residents, accounting fraud and practices questionable in terms of human resources.

Justice opened a preliminary investigation in April for institutional mistreatment and financial crimes, following a report by the government.

The group says it has taken the first steps to change its practices and plans to detail its three-year transformation plan on November 15.

Since the scandal, its title has experienced a dizzying fall on the Paris Stock Exchange.

The action, whose course was suspended on Monday, was displayed at 14.74 euros on Friday at the close of the session, a drop of 83% since the beginning of the year.

Trading will resume on Wednesday when markets open.

© 2022 AFP