Regis’ $45M Buy Raises Questions on Regional Growth and Integration
Regis Healthcare has agreed to acquire two modern aged care homes on Victoria’s Surf Coast and Bellarine Peninsula, adding 230 beds and boosting its portfolio to 74 homes. The $45 million deal is expected to be earnings accretive by FY26.
- Acquisition of Ocean Mist and Drysdale Grove aged care homes with 230 beds
- Deal valued at approximately $45 million, funded from existing cash reserves
- Portfolio grows to 74 homes and around 8,400 beds, all freehold
- Transaction expected to be EPS accretive in FY26 with further growth potential
- Strategic expansion into rapidly growing regional Victoria markets
Strategic Expansion in Regional Victoria
Regis Healthcare Limited (ASX – REG) has announced a significant expansion of its residential aged care portfolio through the acquisition of two high-quality homes – Ocean Mist Aged Care in Torquay and Drysdale Grove Aged Care in Drysdale. Together, these facilities add 230 beds to Regis’ network, increasing its total to approximately 8,400 beds across 74 homes, all held freehold. This move aligns with Regis’ ongoing strategy to broaden its footprint in key growth regions.
Financials and Deal Structure
The transaction, valued at around $45 million on a cash free and debt free basis, will be funded from Regis’ existing net cash reserves, which stood at $99 million as of 30 September 2025. The homes, both recently built or extensively refurbished within the last eight years, feature 100% single ensuite rooms, reflecting a commitment to quality care environments. Regis will also assume a Refundable Accommodation Deposit (RAD) liability of approximately $36 million, with potential upside from increased occupancy and room pricing.
Earnings and Operational Synergies
The acquisition is forecast to be earnings per share (EPS) accretive in the 2026 financial year, with an underlying EBITDA multiple of 7.5 times based on pro-forma annualised earnings of about $6 million. Regis anticipates cost synergies through procurement efficiencies and streamlined corporate structures. The company also highlights the gross price per bed is well below replacement cost, suggesting value accretion for shareholders.
Market Context and Future Outlook
Expanding into the Surf Coast and Bellarine Peninsula positions Regis to serve rapidly growing regional populations with increasing demand for aged care services. CEO Dr Linda Mellors emphasized the importance of integrating these homes smoothly into the Regis portfolio, ensuring continuity of care for residents and staff. This acquisition marks Regis’ 13th home added through acquisition in the past two years, underscoring its aggressive growth trajectory.
Looking ahead, Regis signals continued pursuit of strategic acquisitions that enhance long-term shareholder value, supported by strong cash flows and a robust balance sheet. The deal’s expected completion by 1 December 2025 will be a key milestone in the company’s expansion story.
Bottom Line?
Regis’ latest acquisition cements its regional Victorian presence and sets the stage for further growth in a competitive aged care market.
Questions in the middle?
- How will Regis manage integration risks across its expanded portfolio?
- What occupancy and pricing improvements can realistically be achieved at the new homes?
- Could further acquisitions in regional Victoria accelerate following this deal?
