Extendicare Bets Big on Home Health with $570M Deal, Boosts Dividend

MARKHAM, Ontario – February 26, 2026 – Extendicare Inc. solidified its strategic pivot towards home-based services, capping a year of robust financial growth with the announcement of a 5% dividend increase and providing further details on its transformative $570 million acquisition of CBI Home Health. The company's full-year 2025 results, released today, reveal a significant surge in profitability, driven largely by the very sector it now seeks to dominate.

The Markham-based seniors' care provider reported a 36.4% increase in its fourth-quarter adjusted EBITDA to $45.6 million, excluding out-of-period items. This performance was underpinned by remarkable organic growth in its home health care division, which saw its average daily volume jump by 27.3% compared to the same period in 2024. The strong results provided the foundation for the company to reward shareholders, raising its monthly dividend to 4.41 cents per share.

“Our fourth quarter results build on our strong performance throughout 2025, driven by 15.3% organic growth in our home health segment from the prior year,” said Dr. Michael Guerriere, President and Chief Executive Officer, in a statement. “Based on our positive growth trajectory and the strength of our balance sheet, we have increased our dividend by 5% again this year.”

Forging a Canadian Home Health Empire

At the heart of Extendicare’s strategy is the pending acquisition of CBI Home Health, a move set to create a national powerhouse in community-based seniors' care. The $570 million deal, first announced in November 2025, will see Extendicare’s subsidiary, ParaMed Inc., absorb one of Canada’s largest home care providers.

CBI Home Health, a division of CBI Health LP, brings a substantial operation into the fold, with approximately 8,500 team members delivering over 10 million hours of care annually across seven provinces. With a significant presence in Ontario and Alberta, CBI has built a reputation for a comprehensive suite of services, including skilled nursing, rehabilitation therapy, and innovative models like hospital-to-home transition programs. The company has also been recognized by Deloitte as one of Canada's Best Managed Companies for 18 consecutive years, holding a Platinum Member designation that speaks to its operational strength.

The acquisition is a clear bet on the future of seniors' care in Canada, which is increasingly shifting away from traditional long-term care facilities and towards models that allow individuals to age in their own homes. By integrating CBI Home Health, Extendicare aims to accelerate its service-focused growth strategy and cement its leadership position in this expanding market.

However, the landmark transaction is not yet finalized. It remains subject to customary closing conditions, including regulatory approval under the Competition Act (Canada). The Competition Bureau will review the merger to ensure it does not substantially lessen market competition. Additionally, the deal requires consent from key provincial partners, namely Ontario Health atHome and Assisted Living Alberta, underscoring the complex public-private nature of healthcare delivery.

Dr. Guerriere noted that the approval process is progressing, stating, "we anticipate closing the transaction in early Q2."

Financial Strength Fuels Growth and Shareholder Returns

Extendicare's aggressive expansion is backed by a year of impressive financial performance. For the full year ended December 31, 2025, revenue climbed to $1.66 billion from $1.47 billion in the prior year. Net earnings saw a corresponding 28.5% increase to $96.7 million. The home health care segment was the star performer, with its full-year revenue growing to $701.1 million, up from $566.0 million in 2024, and its Net Operating Income (NOI) margin expanding from 11.1% to 13.9%.

This financial momentum is enabling the dual strategy of major investment and increased shareholder returns. To fund the CBI acquisition, Extendicare completed a $200 million "bought deal" private placement of common shares in December, raising net proceeds of $191.5 million. The remainder of the purchase price will be financed through a combination of an upsized senior secured credit facility and cash on hand.

While the share issuance introduces dilution for existing investors, the company projects the acquisition will be highly accretive, estimating a 20% boost to its fully diluted Adjusted Funds From Operations (AFFO) per share. This projection relies on achieving significant synergies. Extendicare anticipates realizing an initial $7.4 million in annualized run-rate synergies within two years, primarily from integrating IT platforms and other back-office functions.

Looking further ahead, the company sees potential for an additional $5 million to $7 million in annual synergies by deploying enhanced technology to improve productivity in areas like automated scheduling and front-line employee experience. The integration of CBI's systems, which recently renewed a partnership with the AlayaCare cloud platform, with Extendicare’s existing infrastructure will be a critical task in unlocking this value.

The Shifting Landscape of Canadian Seniors' Care

The merger of Extendicare's ParaMed and CBI Home Health represents a significant consolidation in the Canadian seniors' care market. The combined entity will have an enormous footprint, creating a dominant player in a sector that is essential to Canada's aging population. This scale offers the potential for greater efficiency and a wider range of integrated services for clients.

At the same time, such a large-scale merger raises important questions for the sector. The integration of two massive workforces—Extendicare's approximately 28,000 employees and CBI's 8,500—presents a significant logistical and cultural challenge. Ensuring a smooth transition that maintains morale and service continuity will be paramount.

Furthermore, the quality of care will be under a microscope. While CBI brings a strong reputation for management and service, the long-term care industry, including some of Extendicare's own facilities, has faced public scrutiny over standards of care and staffing levels in the past. Advocacy groups and provincial regulators will be watching closely to ensure that the pursuit of cost synergies does not come at the expense of patient care or working conditions for front-line staff.

The successful combination of these two giants could set a new standard for integrated, technology-enabled home and community care in Canada. As the deal moves toward its anticipated closing in the second quarter of 2026, all eyes will be on Extendicare to see if it can successfully balance the demands of growth, profitability, and its fundamental mission to provide quality care for seniors wherever they call home.