Under the plan which is expected to be completed by July 1, unitholders will receive one common share in the new corporation, Extendicare Inc., for each REIT unit held.
The conversion plan is still subject to court and regulatory approvals and Extendicare said it's scheduled to appear in court on May 15 to apply for a final order approving the arrangement.
Extendicare reported Tuesday that it earned $49 million in its latest quarter, boosted by the sale of its group purchasing organization.
The profit compared with a loss of $8.4 million a year ago.
Revenue for the three months ended March 31 totalled $517.2 million, up from $516.6 million, as lower U.S. nursing home revenue was offset in part by an increase in Canada.
Excluding the sale of the group purchasing organization this year, Extendicare said it earned $14.5 million from continuing operations, up from a loss of $9.6 million a year ago.
"In spite of persisting weakness in the economy and a challenging U.S. regulatory and funding environment, Extendicare achieved operating and financial results in the first quarter of 2012 that were in line with our expectations," president and chief executive Tim Lukenda said in a statement.
Extendicare has 263 senior care centres in North America with a total capacity of approximately 28,200 residents.
Its three facilities in Ottawa include Extendicare Medex, New Orchard Lodge and West End Villa.