Stryker CEO Delivers on Promise of More Deals

Only two weeks after Stryker CEO Kevin Lobo told investors to expect a “very active deal pipeline” for the rest of 2024, the company today announced a definitive agreement to acquire Care.ai, a company specializing in artificial intelligence solutions for hospital settings.

Care.ai, based in Orlando, FL, is a startup that offers AI-assisted virtual care workflows, smart room technology, and ambient intelligence solutions in healthcare settings. In turn, Stryker said that the integration of the company’s offerings will help provide its customers with an “enterprise-wide ecosystem that can deliver dynamic clinical workflows and further the development of smart care facilities.”

To do this, the company said it intends to integrate Care.ai’s technology with the Vocera Platform and other Stryker devices. The Vocera platform comes from Stryker’s 2022 acquisition of Vocera for $2.97 billion. The deal gave Stryker entry into communication and workflow platforms for hospital settings.

“This growing segment is of increasing importance as Stryker’s customers continue to face nursing shortages, employee retention challenges, overworked and cognitively burdened staff, and a rise in workplace safety concerns,” according to the press release.

Currently, the deal’s cost and timing have not been disclosed. Both Stryker and Care.ai will continue to operate as separate entities and work as usual until transaction closing.

“This acquisition underscores our commitment and focus on our customers," said Andy Pierce, group president, MedSurg and Neurotechnology at Stryker, in the press release. “Care.ai will help Stryker significantly accelerate our healthcare IT and digital vision to provide customers with real-time, smart and connected decision-making tools that enhance the lives of caregivers and their patients.”

The Care.ai definitive agreement continues Stryker’s recent series of tuck-in M&A deals, including buying Artelon in June, and the December 2023 acquisition of Serf Sas.

As of right now, it seems the company has no intention of stopping the M&A streak.

In Stryker’s Q2 2024 earning call, Lobo said the company will be pursuing an active acquisition pipeline for the rest of the year and those acquisitions will mostly include tuck-in deals.

“We do have a very active deal pipeline,” he said, according to a Seeking Alpha transcript. “Most of them are in the tuck-in variety and most of them are not very large. But you continue to see us be active, as you've seen in the first two quarters of the year, much more active than we were last year. And we will be very active in the second half of the year.”

Stryker directed MD+DI to the company press release when asked for additional comment.