Palo Alto Networks is reportedly negotiating to acquire CyberArk Software, an Israeli publicly traded IT company, in a deal potentially exceeding $20bn.
A report by the Wall Street Journal, citing unnamed sources familiar with the matter, indicated that the US-based cybersecurity company might enter into a definitive agreement for the acquisition as early as this week.
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Palo Alto Networks aims to expand its capabilities to offer comprehensive security solutions, targeting the growing threat landscape shaped by AI. This potential acquisition of CyberArk would mark Palo Alto Networks’ largest deal to date, as the company seeks consolidation within the sector.
Following news of the possible acquisition, shares of CyberArk surged by over 13% on 29 July while Palo Alto Networks experienced a 5% decline in share value, bringing its market capitalisation to slightly under $130bn.
CyberArk is known for its expertise in identity security and privileged access management, offering services to over 10,000 clients worldwide.
Established in 1999 by Udi Mokady, who remains executive chair, CyberArk went public in 2014. The company is currently listed on Nasdaq.
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By GlobalDataUnder CEO Matt Cohen, the company has embraced a subscription-based software business model.
The cybersecurity sector has witnessed strong deal activity as organisations increase their investment in security solutions. Notably, Google’s parent company Alphabet announced its intention this March to acquire Israeli cybersecurity startup Wiz for approximately $32bn.
Increasing competition among integrated cybersecurity platforms has made several companies appealing targets for acquisition by larger companies or private equity groups. As of the close on 28 July, data from the London Stock Exchange Group placed CyberArk’s market valuation at $19.3bn.
Recently, Palo Alto Networks completed the acquisition of Protect AI to strengthen its position in securing AI applications and infrastructure.
By integrating Protect AI’s technology and expertise, Palo Alto Networks aims to address security needs across various industries and solidify its position as a major player in comprehensive AI security through its Prisma AIRS platform.
