Quipt Home Medical to form JV with three health systems

Mr. Gregory Crawford reports QUIPT HOME MEDICAL PARTNERS WITH THREE MAJOR HEALTH SYSTEMS TO FORM STRATEGIC JOINT VENTURE Quipt Home Medical Corp. has signed a definitive agreement with three major health systems and hospitals to form a joint venture. Pursuant to the definitive agreement, Quipt will acquire a 60-per-cent ownership interest in Hart Medical Equipment, with the remaining 40-per-cent interest collectively held by major health systems, Henry Ford Health, McLaren Health Care, Blanchard Valley Health System, Wood County Hospital and The Bellevue Hospital. This strategic transaction is expected to enhance Quipt's presence in the Midwest, add deep health care system partnerships and provide the company with immediate entry into Michigan, a large and strategically important market, and new territories in Ohio. Transaction highlights: Hart, headquartered in Michigan, is a leading nationally accredited durable medical equipment supplier with over 20 years of experience. It generated approximately $60-million in revenue and $7-million in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the 12 months ended June, 2025. With 29 branch locations across Michigan and Ohio, this transaction formally establishes Quipt's presence in Michigan and northern Ohio, and strengthens its existing Midwest footprint. For reporting purposes, Quipt expects to consolidate the financial results of Hart and hence upon completion of the transaction, Quipt's expected annualized run-rate revenue will be approximately $300-million. As the primary beneficiary of the joint venture it is expected that the 40-per-cent non-controlling equity interest will be reported as a separate component on the company's consolidated statements of financial position. Hart maintains long-standing strategic relationships with leading integrated health systems, including Henry Ford Health, McLaren Health Care and Blanchard Valley Health, as well as freestanding community-based hospitals, embedding the business into the hospital discharge processes of more than 19 hospitals and affiliated care facilities across its network. These relationships provide direct access to a large, consistent patient base, with Hart serving over 67,000 patients monthly. The joint venture is expected to strengthen Quipt's strategy of expanding relationships with health care systems and building scalable integration models that embed Quipt into discharge planning and care co-ordination. The joint venture positions Quipt in the evolving health care reimbursement environment, working alongside health systems heavily invested in value-based care. Management expects adjusted EBITDA margin to align with historical corporate averages within three quarters postclosing. Synergies are anticipated through operational efficiencies and cross-market integration. Quipt's expected total consideration for its 60-per-cent ownership interest is in the range of $17-million to $18-million. The transaction is expected to close by the end of fiscal Q4 2025, subject to customary closing conditions, including approval by the lender to Quipt's existing credit facility. Statement from Barton P. Buxton, EdD, board chair, Hart Medical: "The Hart Medical board was very focused on finding the right strategic partner to align with our mission of not only caring for patients at home following their discharge but also supporting their ongoing transitional care needs. As health care systems continue to explore innovative ways to manage critically ill populations in a payer environment that increasingly drives us toward managing risk, we carefully evaluated our options. Of all the potential partners, Quipt Home Medical demonstrated the strongest platform and shared commitment to continue and expand the important work Hart Medical has begun. "We are excited about the opportunities this partnership creates -- not only to elevate our transitional care services to the next level, but to set a new standard of care for health systems and DME collaborations. Hart Medical has always striven to meet and exceed the expectations of our health system partners, and we are confident that our alliance with Quipt Home Medical will strengthen our ability to deliver exceptional patient outcomes and innovative solutions." Management commentary "Hart's impressive footprint across Michigan and Ohio and its relationship with world-class health systems like Henry Ford Health, McLaren Health and Blanchard Valley, bring a new level of depth and reach to our platform," said Greg Crawford, chief executive officer and chairman of Quipt. "This transaction expands our service network to more than 19 hospitals and affiliated care facilities, dramatically increasing our ability to serve patients at critical points of care transition. Importantly, the joint venture structure allows us to collaborate closely with Hart's leadership team while maintaining operational alignment across the broader Quipt platform. This move is consistent with our strategy to expand our business with strategic relationships with leading health systems, work with hospitals in providing post discharge durable medical equipment products and services and create a scalable template for future growth nationwide. Hart's reputation for clinical excellence and strong health system alignment fits perfectly with our mission and platform." Chief financial officer Hardik Mehta added: "This joint venture marks a significant step forward in expanding our platform in a disciplined and strategic manner. We anticipate funding this transaction using cash on hand and our existing credit facility. As we integrate operations, we see clear opportunities to align operating systems and share best practices that will enhance operational efficiency, support sustainable growth and optimize financial performance. This is exactly the type of health-system-aligned expansion we have been targeting, and we are confident that the Hart joint venture will serve as a repeatable model for future joint ventures, as we continue to build a diversified, national platform capable of delivering strong patient outcomes and long-term shareholder value." About Quipt Home Medical Corp. The company provides in-home monitoring and disease management services including end-to-end respiratory solutions for patients in the United States health care market. It seeks to continue to expand its offerings to include the management of several chronic disease states focusing on patients with heart or pulmonary disease, sleep disorders, reduced mobility, and other chronic health conditions. The primary business objective of the company is to create shareholder value by offering a broader range of services to patients in need of in-home monitoring and chronic disease management. The company's organic growth strategy is to increase annual revenue per patient by offering multiple services to the same patient, consolidating the patient's services and making life easier for the patient. We seek Safe Harbor.