Israeli cybersecurity company CyberArk is to pay $1.54 billion for US-based Venafi in what will become the Startup Nation’s biggest acquisition so far in 2024.
CyberArk develops identity management software that protects governments and companies in the financial services, energy, retail and healthcare sectors from fraud. It was founded in Petach Tikva, went public on the NASDAQ in 2014 and is now jointly headquartered in Massachusetts.
The company is acquiring Venafi, a Salt Lake City-based startup which specializes in securing machine-to-machine connections — a complex and fast-growing area that complements CyberArk’s current machine-to-human security activities.
CyberArk is buying Venafi from Thoma Bravo, one of the largest software-focused investors in the world, for approximately $1 billion in cash and $540 million in shares. The acquisition is expected to close in the second half of this year.
It is the biggest acquisition involving an Israeli company to date this year, surpassing that of Israeli fraud detection startup BioCatch, announced earlier this month, for $1.3 billion.
“This acquisition marks a pivotal milestone for CyberArk, enabling us to further our vision to secure every identity – human and machine – with the right level of privilege controls,” said Matt Cohen, CyberArk’s CEO.
“By combining forces with Venafi, we are expanding our abilities to secure machine identities in a cloud-first, GenAI, post-quantum world.”
Businesses have historically paid less attention to ID threats from machines, but the exponential growth in connected devices is now forcing them to act.
Machine identities — the digital credentials used by machines, applications, services and devices to authenticate and communicate securely within a networked environment — now outnumber human identities by 40 to one, according to CyberArk.
Machine identities are potentially profitable targets for cybercriminals, so they need to be discovered, managed, secured and automated to keep their connections and communications safe. Venafi does so by managing the keys and certificates used to ensure communication over the internet remains secure.
CyberArk says that Venafi will expand its total addressable market (TAM) by nearly $10 billion to approximately $60 billion.
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