French operator of 112 Dutch healthcare centers in deep financial trouble

The French healthcare group Orpea, which is also active in the Netherlands, is in serious financial trouble. The company has a debt of 9.5 billion euros. To reduce this, the management wants to divest business units, sell off real estate and exit from some international markets, the company announced on Tuesday. Details of a plan were not revealed.

Orpea was founded in 1989. According to figures on its own site, the company operates 983 locations worldwide in 23 countries, where approximately 72,000 employees provide care for more than 255,000 people.

In the Netherlands, Orpea owns the brands Allerzorg, Bloemendael, Compartijn, Dagelijks Leven, Van Hollant, Wonen bij September, Woonzorgnet and Zorggroep ’t Zicht. Some of those organizations were acquired last year. According to Orpea, the Dutch brands have 112 locations with a total of more than 2,500 placements spread across the country.

In a joint statement, the Dutch Orpea subsidiaries said they will sell real estate which they can then rent back from the new building owners, "just like we did in the past." About the "challenging" financial situation, the healthcare organizations said, "Fortunately, the problems that Orpea has experienced in a number of countries have not affected us in the Netherlands. The Netherlands is seen by Orpea as a core country of which it is proud, and Orpea will not withdraw from the Netherlands."

According to current CEO Laurent Guillot, who took office on 1 July, the problems at Orpea are the fault of the previous board who paid too little attention to healthcare, and was too occupied by real estate development. The company’s leadership also allegedly embezzled money.

At the beginning of this year, French journalist Victor Castanet published a book about the caregiving practices at Orpea locations. He wrote that the elderly were sometimes denied care for several days, sitting in their own excrement. Food was also rationed.

Orpea is listed on the Paris stock exchange, where share prices plummeted after the publication of the book. At the beginning of the year, a share of Orpea was worth about 90 euros. It’s value currently fluctuates between about 6 and 10 euros.