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Extendicare to Expand its Home Health Care Business by Acquiring CBI Home Health for $570 Million in Cash Consideration
Expand Energy CorporationExpand Energy Corporation(US:EXE) Globenewswireยท2025-11-19 22:18

Core Insights - Extendicare Inc. announced the acquisition of CBI Home Health for a cash purchase price of $570 million, which will enhance its service offerings and strengthen its market position in home health care [2][3][11] - The acquisition is expected to generate significant synergies and improve financial metrics, including a projected 20% accretion in AFFO per share and 15% in earnings per share [9][11] Acquisition Details - The acquisition will be funded through a combination of a $264.5 million upsizing to Extendicare's existing credit facility and a $200 million bought deal private placement equity offering [5][15][16] - CBI Home Health delivered over 10 million hours of care annually across seven provinces, with a revenue of approximately $477.9 million and an Adjusted EBITDA of $61.9 million for the twelve months ended July 31, 2025 [10][11] Financial Metrics - The acquisition price represents an estimated purchase price multiple of 9.4x CBI Home Health's Adjusted EBITDA, which could improve to approximately 8.4x after accounting for expected synergies of about $7.4 million [11][12] - Extendicare's pro forma total debt to Adjusted EBITDA ratio is projected to be 3.3x as of September 30, 2025, post-acquisition [8][15] Strategic Rationale - The acquisition aligns with Extendicare's growth strategy by enhancing its capabilities in home health care and expanding its geographic footprint, particularly in Western Canada [6][9] - The combination of ParaMed and CBI Home Health is expected to improve access to community-based care and leverage technology for better customer experience and cost efficiencies [6][9] Offering Details - Extendicare plans to issue 10.64 million common shares at a price of $18.80 per share, aiming for gross proceeds of approximately $200 million from the private placement [5][17] - The closing of the offering is anticipated around December 3, 2025, subject to regulatory approvals [17]