Palo Alto agrees to buy Talon Cyber Security in M&A ramp-up

Dive Brief:

Palo Alto Networks on Monday announced an agreement to buy Israeli startup Talon Cyber Security, as it ramps up merger-and-acquisition dealmaking.
The transaction, which reportedly is valued at $625 million, will combine Talon’s Enterprise Browser tool with Palo Alto Networks’ PrismaSASE service, enabling users to securely access business applications from any device, including mobile phones, according to a press release. The financial terms weren’t disclosed in the announcement.
“The unique combination of Prisma SASE and Talon will transform how organizations navigate the challenges of today's modern and connected digital environments,” Anand Oswal, senior vice president and general manager for Santa Clara, California-based Palo Alto Networks, said in the release.

Dive Insight:

The agreement comes on the heels of Palo Alto Networks’ recent decision to acquire cloud security start-up Dig Security, another Israeli startup. The deals are occurring against the backdrop of Israel’s ongoing war with the Hamas militant group.

“Today's announcement underscores our continued belief in the strength of the Israeli cybersecurity ecosystem and our commitment to our growing team in Israel,” Lee Klarich, chief product officer for Palo Alto Networks, said in the Monday release.

During an August earnings call, Palo Alto Networks CFO Dipak Golechha said the company had “ample cash generation” to make investments aimed at driving business growth.

“Our first capital allocation priority is our M&A strategy,” Golechha said during the call. He said the company looks for acquisition targets “that have achieved product market fit with teams that can accelerate their innovation inside Palo Alto Networks.”

Talon says its browser-based security approach is designed to provide businesses with visibility into all employee corporate activity across locations, devices and software-as-a-service solutions, which is more important than ever in light of the proliferation of distributed work models. The company, which was Founded in 2021, also provides data security controls natively in the browser to prevent data exfiltration, Oswal wrote in a Monday blog post.

“For example, organizations can put controls in place for downloading files, copying sensitive data and taking screenshots,” Oswal wrote.

In August 2022, the company announced that it raised $100 million in a Series A funding round led by Evolution Equity Partners, with participation from Ballistic Ventures and CrowdStrike’s Falcon Fund. This brought the total amount of funding the company had raised to over $126 million, according to a press release at the time.

The startup’s co-founders are expected to continue leading their teams when they join Palo Alto Networks’ Prisma SASE unit after the transaction is closed.