Jan. 28 (Bloomberg) -- French retirement-home operators including Orpea SA, Korian and Medica SA, plunged in Paris trading on signs the government will restrict rent increases.
Orpea, France’s biggest publicly traded operator, lost as much as 8.1 percent to 29.90 euros, the steepest intraday drop since Nov. 15, 2011. The Puteaux-based company’s stock was trading at 30.34 euros as of 10:38 a.m. in Paris today. Korian shares fell 6.1 percent to 13.51 euros.
President Francois Hollande’s government wants to “act on the cost of retirement homes,” Michele Delaunay, delegate minister for the elderly and the dependent, was cited as saying in an interview with Le Parisien two days ago. The minister also told the newspaper that the facilities will no longer be allowed to increase room costs for older people at will.
The minister’s comments sparked concern about potential “uncertainty on the regulatory environment” for these companies, Mathieu Chabert, an analyst at Bryan Garnier & Co. in Paris, said in a telephone interview. “This is weighing on shares of nursing-home operators today.”
Shares in Medica, another retirement-home operator, plunged 6.6 percent to 13.78 euros while rival Le Noble Age was down 2.2 percent to 11.38 euros.
To contact the reporter on this story: Albertina Torsoli in Paris at email@example.com
To contact the editor responsible for this story: Phil Serafino at firstname.lastname@example.org