SFTP Connect Fails with: Failed to read initial server version string

The initial connection to the SFTP server fails with this error:

...
        --connectSocket
        Established TCP/IP connection with SSH server
        Turning on TCP_NODELAY.
      --sshConnect
      sshSetupConnection(8000ms):
        clientIdentifier: SSH-2.0-PuTTY_Release_0.66
        Sending client identifier...
        Done sending client identifier.
        Reading server version...
        Failed to read initial server version string
        bytesReceived:
      --sshSetupConnection
    --connectInner
    Failed.
  --Connect_SFtp
--ChilkatLog