Palo Alto Networks will take over Israeli identification safety supplier CyberArk in a deal valued at roughly $25 billion.
The California-based cybersecurity firm pays shareholders $45 apiece for two.2005 shares of CyberArk, representing a 26% premium to its share worth Friday. The deal is anticipated to shut throughout Palo Alto Networks’ fiscal 12 months 2026.
Shares of Palo Alto fell greater than 8% Wednesday, constructing on a 5% loss from Tuesday. CyberArk’s inventory dipped about 2%.
Palo Alto CEO and chairman Nikesh Arora mentioned in an interview with CNBC’s “Squawk on the Avenue” on Wednesday that the corporate is coming into the identification market because it hits an inflection level, which has at all times been its technique.
“They’re poised to go and disrupt this market and create the platform we’d like and in addition remedy the upcoming downside with agentic AI,” he mentioned. “From all these elements, we consider that is the fitting time to do one thing like this and be prepared for the market within the subsequent 12 to 18 months.”
Blockbuster cybersecurity offers have been a power within the mergers and acquisitions market in 2025 after a comparatively sluggish interval for dealmaking. In March, Google shelled out $32 billion for cloud safety startup Wiz in its largest acquisition ever.
Palo Alto Networks intends to make use of the deal to formally penetrate the identification safety market and enhance its providing for purchasers. Arora informed CNBC that Palo Alto’s scale might help speed up the attain of CyberArk’s platform.
CyberArk, which went public somewhat over a decade in the past, creates identification software program instruments that grant workers entry to platforms and functions. Its largest rivals within the area embrace Okta and Microsoft.
As synthetic intelligence advances, these instruments have change into extra vital to defending companies in opposition to cyber and ransomware threats.
Since taking the helm of the corporate in 2018, Arora has bolstered the cybersecurity supplier’s choices and swelled its market worth to roughly $120 billion.
This 12 months, Palo Alto purchased startup Defend AI for an undisclosed quantity to enhance its AI instruments. The corporate acquired Talon Cyber Safety, Dig Safety and Zycada Networks in 2023.
Arora mentioned he expects ongoing consolidation within the cybersecurity area over the subsequent 5 years.
“Our job is to get this accomplished, execute, ship to the market and present our shareholders that we’ve got the power to execute these sorts of transactions, which I firmly consider we do,” he mentioned.
The Wall Avenue Journal reported Tuesday that each firms had mentioned a possible deal, sending shares of CyberArk skyrocketing greater than 13%.
5 day inventory chart of Palo Alto Networks and CyberArk.
– CNBC’s Jordan Novet and Ari Levy contributed to this text.
