Palo Alto Networks, a Santa Clara, California-based cybersecurity firm founded by American-Israeli entrepreneur Nir Zuk, announced on Wednesday that it will acquire Israeli firm CyberArk in a deal valued at a staggering $25 billion.
It marks the biggest ever acquisition of an Israeli company after Google’s $32 billion purchase of Israeli-founded cybersecurity unicorn Wiz earlier this year. The third-largest deal was US giant Intel Corp’s purchase of Mobileye, a Jerusalem-based developer of advanced vision and driver assistance systems, for $15.3 billion in 2017.
For Palo Alto, it is the largest deal the company has made to date. The deal comes despite Israel’s ongoing war with the Hamas terror group and heightened geopolitical tensions with Lebanon and Iran.
“It’s a leap of faith, as it shows that although there is war, although there is conflict, although there is negative sentiment, Israel is seen as a sustainable place that yields great technology,” Demi Ben-Ari, chief strategy officer of cybersecurity company Panorays, told The Times of Israel. “CyberArk is an Israeli publicly traded information security company, which means that taxes will be paid here, which will have a positive impact.”
Under the terms of the cash-and-stock agreement, Palo Alto will pay CyberArk shareholders $45 in cash per share and 2.2005 shares of Palo Alto Networks common stock for each share they own. The firm’s main shareholders are asset manager BlackRock, FMR and investment firms such as Thomas Bravo, Invesco, and T. Rowe Price.
Traded on the Nasdaq stock exchange since 2014 with a market cap of almost $22 billion, CyberArk specializes in identity security, including privileged accounts on corporate servers, to help businesses protect sensitive data and critical infrastructure against external attackers and malicious insiders. Zuk, a former engineer at Israeli cybersecurity firm Check Point Software Technologies, set up the competing Palo Alto back in 2005 and grew it into a publicly traded firm with a market value of $120 billion.
Israeli cybersecurity firm CyberArk’s headquarters and R&D center in Petah Tikva. (Courtesy)
Palo Alto, which went public on Nasdaq in 2012, has a global workforce of 13,000 employees, including over 1,000 in Israel.
Palo Alto said the acquisition is part of its strategy to integrate identity security as a new core pillar of its platform to help its more than 70,000 enterprise customers respond faster to emerging AI threats. The deal is expected to close during the second half of Palo Alto’s fiscal 2026, subject to the receipt of regulatory clearances and approval by CyberArk shareholders.
Palo Alto Networks founder & CTO Nir Zuk (YouTube Screenshot)
“Today, the rise of AI and the explosion of machine identities have made it clear that the future of security must be built on the vision that every identity requires the right level of privilege controls,” said Palo Alto chairman and CEO Nikesh Arora. “CyberArk is the definitive leader in Identity Security with durable, foundational technology that is essential for securing the AI era.”
The cybersecurity market continues to face new challenges with the fast emergence and adoption of AI-powered tools and software by businesses and organizations as they move to cloud services and hybrid working environments, which in turn has expanded their threat landscape and attack surface.
All this has created an explosion of identities as people, whether they are employees, third-party users, or customers, use many devices to connect to a network. In parallel, the digital transformation and the ongoing migration to cloud services have led to an increase in the use of non-human applications or identities, such as machines, bots, and workloads.
CyberArk founder and executive chairman Udi Mokady described the deal as a “profound moment” in the firm’s history.
“Joining forces with Palo Alto Networks is a powerful next chapter, built on shared values and a deep commitment to solving the toughest identity challenges,” said Mokady. “Together, we’ll bring unmatched expertise across human and machine identities, privileged access, and AI-driven innovation to secure what’s next.”
Demi Ben-Ari, chief strategy officer of cybersecurity company Panorays. (Courtesy)
“This is more than a combination of technologies—it’s an acceleration of the mission we began over two decades ago,” he remarked.
Founded in 1999, CyberArk has more than 4,000 employees globally, of which about 1,200 work at the firm’s headquarters in Petah Tikva and R&D center in the southern city of Beersheba. All of CyberArk employees are expected to be maintained and will continue to work in Israel following the completion of the acquisition.
“Palo Alto has over the years been acquiring solutions that they can apply to a large customer base, and they have proven that thesis,” said Ben-Ari. “They are creating suites, but it came out of network, expanded to cloud, expanded to security operations, which are big pillars in the cybersecurity space, and what they are now missing is identity, and Cyberark is one of the biggest identity suites in the world.”
Over the past decade, Palo Alto has invested more than $1.5 billion in acquiring smaller startups in Israel and views the country as a key hub for its growth. During the first month after war broke out with the Hamas terror group on October 7, 2023, Palo Alto bought Israel’s Talon Cyber Security for about $600 million, and local startup Dig Security, a developer of a platform to secure data across public clouds, for about $400 million.
The cybersecurity giant acquired Cyvera for $200 million in 2014; LightCyber for $130 million in 2017; CyberCubes and Secdo in 2018; and Twistlock ($410 million), PureSec, and Demisto ($560 million) in 2019, according to data compiled by Start-Up Nation Central.
