Clearwater health tech company sells for $475 million

Kinderhook Industries has agreed to sell Stratus Video in Clearwater to AMN Healthcare Services for $475 million.

Stratus provides language interpretation services for the healthcare industry. It has developed proprietary technologies to provide video remote interpretation, over-the-phone interpretation and in-person interpretation. The company employs a network of more than 3,000 interpreters and serves more than 1,600 clients including health systems, acute care hospitals, community health centers, federally qualified health centers, ambulatory surgery centers and post-acute and home health providers.

The company was founded in 2012 and acquired by Kinderhook, a New York-based private investment firm, in 2015. Stratus topped $100 million in revenue last year. Revenue increased when Stratus merged with rival InDemand Interpreting in mid-2019, according to Slator, an industry publication.

In 2018, Stratus spun out its patient program management operations into a separate company, Synzi, that is headquartered in St. Petersburg.

AMN Healthcare Services (NYSE: AMN), with corporate offices in San Diego and in Dallas, is a healthcare staffing firm with $2.1 billion in revenue in 2018. Buying Stratus helps the company  positively impact patient care through innovative talent solutions, Susan R. Salka, CEO of AMN Healthcare, said in a news release.

“Qualified healthcare interpretation, which is mandated by federal and many state regulations, is a service that many healthcare organizations do not have the resources to provide for themselves. This acquisition also helps further deliver on AMN’s commitment to help deliver quality, compassionate patient care, reduce complexity, increase efficiency and improve the patient and clinician experience. Quality medical interpretation services delivered through a secure communications platform also aligns with AMN commitment to equality and inclusion by supporting greater access to care for limited-English proficient patients, deaf and hard of hearing individuals along with their families,” Salka said.

The deal represents “a great outcome for Kinderhook, Stratus and its employees,” said Chris Michalik, managing director at Kinderhook, in a separate news release.

“We are very proud of the accomplishments of Stratus’ team, led by David Fetterolf and Maureen Huber, and we expect the company to continue to flourish as part of AMN Healthcare. Our investment in Stratus highlights the key tenets of Kinderhook’s investment strategy – partnering with world class management teams to aggressively grow businesses in niche markets both organically and through acquisition,” Michalik said.

AMN will pay cash for Stratus, and plans to fund the deal through a combination of cash on hand and debt. The deal is expected to close in March.

J.P. Morgan served as exclusive financial advisor to AMN, and legal counsel was provided by Sheppard Mullin. Evercore acted as exclusive financial advisor to Stratus Video, and Kirkland & Ellis provided legal counsel.