Aged care landscape shifts as more acquisitions are announced

Published on 16 November 2023

Regis Healthcare has acquired one of the newest aged care homes, Camp Hill, in a $74 million acquisition of Queensland’s CPSM Care. [Source: Regis Aged Care]

A pair of acquisitions have further highlighted the duality of regional and metropolitan aged care as well-resourced operators expand their reach to ensure more older Australians continue to have access to local aged care services. 

While it is a sign that independent providers are struggling to meet financial and operational demands, it shows that others are willing to step up and provide invaluable support.

Key points

  • Regis Healthcare has further expanded its reach in Queensland, acquiring privately-owned CPSM Care for $74.2 million
  • The acquisition adds five more residential aged care homes to the Regis Aged Care portfolio in Brisbane and Gold Coast; in total, there are 644 operational beds at CPSM
  • Elsewhere, Apollo Care has acquired two homes in the small New South Wales town of Tenterfield, both belonging to Tenterfield Care Centre (TCC), a community-managed not-for-profit provider
  • Apollo Care has nine other homes across Australia’s eastern states, while its acquisition of TCC means an additional 28 beds can be added to the homes, increasing the total number of beds in the town to 110

Regis Aged Care strengthens South-East Queensland presence

ASX-listed Regis Healthcare was the first to announce its next big move on Wednesday as it entered into a binding agreement to acquire CPSM Care and its five aged care centres: Holland Park and Camp Hill in inner-city Brisbane Lodges On George and Aspley in the city’s northern suburbs and Magnolia, located on the Gold Coast’s northern outskirts. 

Regis said the $74.2 million acquisition is consistent with its strategy to broaden its residential aged care footprint. It has successfully done just this as it will add 644 operational beds in major metropolitan locations. Regis now has over 7,600 beds across 68 national sites. 

“I am pleased to announce the acquisition of CPSM, a highly regarded residential aged care provider in Queensland. This transaction is consistent with our strategy to broaden our residential aged care footprint through the acquisition of premium homes,” detailed Regis CEO Dr Linda Mellors. 

“CPSM shares many common values with Regis and I commend the founders for the high-quality business they have built. I look forward to welcoming CPSM’s residents, families, employees and communities to Regis and ensuring a seamless transition of services.”

  • CPSM’s $44 million Camp Hill site is a new addition, having opened in 2022, while more than 80% of the beds at all sites have been built or refurbished since 2018. There is a high 96% occupancy rate across all sites.
  • Each home has an average portfolio star rating of 4+ for compliance and quality measures.
  • Financially, the CPSM properties generated $67 million in operating revenue during FY23 and an underlying EBITDA (earnings before interest, taxes, depreciation and amortisation) of $13 million. 
  • The RAD liability assumed is expected to be roughly $151 million while the purchase has been struck at a multiple of 5.7 times the FY23 underlying EBITDA, which is $115,000 per bed.

Apollo Care expands its regional reach

Residents at the Millrace Aged Care Hostel enjoy an afternoon in their shared outdoor space. [Source: Facebook]

W town of Tenterfield. TCC manages the Haddington aged care home and Millrace, which features independent living units and a hostel. 

The community-managed not-for-profit organisation acknowledged it could no longer operate as a standalone provider. This is a common theme for many regional and rural providers. The acquisition is a good news story, however, as TCC Chair Greg Saur said it’s a good fit between the two organisations. 

“We’re pleased to be joining Apollo Care as we can now continue providing quality aged care to our residents and guarantee our employees will keep their jobs. Importantly, we can also complete construction of a new wing at Haddington to bring 28 new beds online for the wider community,” he explained.

“We will adopt Apollo Care’s innovative care, operating and financial models to strengthen our services while ensuring we retain our strong local community identity.”

For Apollo Care, it’s been a busy few months. In October they also expanded into Victoria via Yackandandah Health while adding a fourth site in Queensland at Mirani, near Mackay. Like those additions, their resources will be used to attract staff to Tenterfield and introduce new systems and procedures in the IT, culture and governance spaces. Apollo Care CEO Stephen Becsi OAM said it’s a win for the local community.

“I’m delighted to welcome Tenterfield Care Centre Ltd into our alliance of nine aged care communities. We have an excellent track record of strengthening regional aged care communities across Queensland, New South Wales and Victoria, and we understand the unique challenges of residential aged care in regional and rural settings like Tenterfield,” Mr Becsi said. 

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