July 28, 2021

A private equity firm based in New York and London plans to acquire Avera eCare.

Aquiline Capital Partners is the buyer for the telemedicine operation grown by Avera Health over the past two decades, which is being renamed Avel eCare.

“I know that they see there’s potential for this to not only scale nationally but internationally,” said Bob Sutton, Avera’s CEO. “To scale it, to put the capital in to scale this, really needed … a buyer that could take it to the level where it could reach even more people.”

Avel eCare’s headquarters will remain in Sioux Falls, and its more than 230 employees will remain.

The telemedicine operation here has grown to serve more than 600 health care systems, rural hospitals, outpatient clinics, long-term care facilities, assisted living centers and schools across the country. That ranks it among the largest and most comprehensive virtual health networks worldwide.

Service lines include behavioral health, correctional health, emergency, hospitalist, intensive care, pharmacy, school health, specialty clinic and senior care.

“Avel eCare has developed an innovative solution that provides critical services to underserved communities in the growing telemedicine market. It aligns with our expertise in establishing corporate carve-outs and helping to build tech-enabled service businesses,” Jeff Greenberg, chairman and CEO of Aquiline, said in a statement.

“We look forward to building on Avel eCare’s strengths and working closely with the management team to expand their services and enhance their offerings for clients around the country.”

Aquiline, which was founded in 2005, has $6.4 billion in assets under management. It splits its headquarters between New York and London and invests in companies across financial services, technology, business services and health care.

“My sense is that this is a great partnership,” said Deanna Larson, who will remain CEO of Avel.

“We understood their interest in eCare and the eCare delivery model and understood their experience with the health care industry, insurance and technology that could augment some of what we do. So it was the perfect time for us to come forward with an organization that can really understand what we’ve done so far and help take us even further.”

The Avel model is unique in that it is structured as a business-to-business service that augments local health care teams. It allows patients to have broader access to clinicians, and it allows physicians in more remote areas access to colleagues virtually, she said.

“That’s a unique offering in the market,” she said.

The pandemic further accelerated interest in virtual health care delivery, Avera leaders said. Billions already have been invested in it, and many who were skeptical of the delivery model became convinced, Larson said.

“There are a lot of patients and providers who understand virtual care really does serve a purpose. It doesn’t take the place of health care that needs to go on face to face but certainly serves a purpose,” she said.

The acquisition is expected to close in the fourth quarter. Terms of the deal are not being disclosed.

Proceeds will be deployed within the Avera organization with a focus on the system’s priorities of patients, employees and facilities, Sutton said.

“And those aren’t just words for us. We have opportunities to further impact the well-being of the communities that we serve and to expand our footprint in our region,” he said. “Delivery of care and delivery of rural health care is really core to our values and the communities and people we serve. So those proceeds will be invested in allowing us to focus on our core business and do what we do best – take care of people as close to home as we possibly can.”

Avera patients will continue to have access to virtual care without service interruption, Larson said. Employees will continue to support virtual health needs across the broader telemedicine network.

“We’re really grateful for all that Avera has done to help us build this health care delivery model,” she said. “We’re really grateful for the (Catholic) sisters who allowed us to respond to a bigger call across the nation and allow this equity investor to help us get there.”