The soon-to-be remaining ASX-listed aged care provider has entered into a binding agreement to acquire privately-owned residential aged care provider CPSM Pty Ltd.
The transaction – which will increase Regis Healthcare’s portfolio by 9% to 68 aged care homes and 7,604 aged care beds – marks the first acquisition for the provider in four years.
In 2019, the group acquired two aged care homes from the community-based Lower Burdekin Home for the Aged Society and its 173 beds south of Townsville, Queensland.
This new agreement will see Regis Healthcare acquire 100% of the ordinary shares of CPSM Pty Ltd (CPSM) for $74.2 million funded by existing debt facilities – a net price of around $115,000 per bed.
Founded in 2010, CPSM has five aged care homes – four in Brisbane and one on the Gold Coast:
- Camp Hill Aged Care (pictured above) in Camp Hill, 6km south east of the Brisbane CBD;
- Holland Park Aged Care, 7km south east of the Brisbane CBD in Holland Park West;
- Lodges On George at Kippa Ring, 40km north of Brisbane on the Redcliffe Peninsula;
- Magnolia Aged Care Coomera, 72km south of Brisbane at Mt Tamborine (Regis Healthcare’s first Gold Coast site after it sold a development site at Palm Beach in 2020-21; and
- Aspley Aged Care, 16km north of the Brisbane CBD in Aspley.
With an average occupancy in Q1 FY24 of 96%, 80% of CPSM’s 644 beds have been built or refurbished since 2018. In FY23, CPSM recorded an operating revenue of $67 million with an underlying
EBITDA of $13 million.
As part of the transaction, Regis Healthcare will take on CPSM’s RAD liability of around $151 million.
As we reported in August, Regis Healthcare paid down its debt to just $6 million in FY23 and at the time, had over $350 million of undrawn bank facilities to seek out acquisitions.
Regis’ CEO Dr Linda Mellors (pictured) told The Weekly SOURCE that the operator is on the lookout for further acquisition opportunities.
“The focus for us [has been] on paying down our debt and getting our house in order for better times,” she stated.
“We now have a good war chest in place for this next period of time.”
The deal is expected to be completed by 1 December 2023.
