Palo Alto Networks Acquires Israeli Cyber Giant CyberArk for $25 Billion in a cash and stock deal

In one of the largest tech acquisitions in Israel's history, Palo Alto Networks announced Tuesday the acquisition of CyberArk for $25 billion in a cash and stock deal. The deal marks the second-largest Israeli cyber exit ever, trailing only Google's $32 billion purchase of Wiz earlier this year.

The acquisition values CyberArk at a 26% premium over its recent Wall Street trading price. Following early reports of the deal, CyberArk’s stock surged 13.5% yesterday, reaching a valuation of $21 billion.

Under the deal terms, each CyberArk shareholder will receive $45 in cash and 2.2 shares of Palo Alto Networks stock for each share held. The transaction is subject to regulatory approval and a vote by CyberArk shareholders, and is expected to close in the second half of 2026.

Strategic Shift for Palo Alto into Identity Security

The acquisition completes a major strategic shift for Palo Alto Networks, which has been building a comprehensive suite of cybersecurity solutions. CyberArk’s expertise in identity protection fills the final gap in Palo Alto's portfolio.

Despite previously stating that identity management was not a priority, Palo Alto’s Israeli co-founder and CTO, Nir Tsuk, acknowledged the rise of AI-driven cyber threats has made identity protection one of the most critical areas in cybersecurity.

“AI systems have become digital identities themselves,” said a joint statement from the companies. “Managing their permissions and access is now a top security challenge.”

CyberArk: From Israeli Pioneer to Global Leader

Founded in 1999 by Alon Cohen and Udi Mokedi, CyberArk has grown into a global leader in identity protection, employing nearly 4,000 people, including 1,000 in its Petah Tikva offices. Mokedi recently transitioned from CEO to chairman.

The company’s technology manages access rights for people, systems, and AI across corporate networks—ensuring users and software only get access to the right systems, at the right time, with oversight to prevent breaches.

CyberArk reported $1 billion in revenue in 2024 (up over 30%) and is on track to hit $1.3 billion in 2025 with $225 million in operating profit—a financial profile that outshines peers like SentinelOne, which had also been in acquisition talks with Palo Alto.

Palo Alto’s Largest-Ever Acquisition

Though known as an aggressive acquirer, Palo Alto has until now avoided deals over $1 billion or involving public companies. The $25 billion CyberArk deal is a bold leap for the company, which is currently valued at around $130 billion and is enjoying a surge in its stock.

Palo Alto, led by CEO Nikesh Arora and founded by Israeli Nir Tsuk, also has a major development center in Israel with over 1,000 employees.

Deal Structure and Shareholder Impact

CyberArk, listed on the Nasdaq since 2014, has a highly dispersed ownership structure, with major shareholders including BlackRock, Fidelity, Wellington, and Thoma Bravo. Although originally founded by Israelis, most of the equity is now held by foreign institutional investors.

According to early assessments by the Israeli Ministry of Finance and Tax Authority, the state is expected to collect hundreds of millions of shekels in taxes from the deal—a modest sum compared to the ₴4 billion expected from the Wiz-Google acquisition.

A Landmark Moment for Israeli Tech

This deal highlights Israel’s continued dominance in the global cybersecurity arena and underlines the increasing value of identity and access management in an era of AI-led digital transformation.

CyberArk's breakthrough acquisition of U.S. firm Venafi for $1.5 billion in 2024 positioned it as a consolidator in its space—making it an even more attractive asset for Palo Alto.

“CyberArk is the final puzzle piece,” an analyst noted. “With AI reshaping security needs, identity protection is now mission-critical.”