Palo Alto preparing the acquisition of the decade? They've confirmed one purchase, with another giant on target
Focus on AI in cyber security drives acquisition market. Palo Alto Networks has officially confirmed the finalisation of its acquisition of Protect AI, a company specialising in artificial intelligence protection. At the same time, unconfirmed information is circulating in the industry about a possible, much bigger move – the acquisition of SentinelOne for up to $10 billion.
Palo Alto Networks does not comment on speculation about SentinelOne, which may be a strategic move to avoid increasing the valuation of a potential target. However, the confirmed acquisition of Protect AI is part of the company’s strategy to strengthen its portfolio through acquisitions of specialised players. The integration of Protect AI’s technology with the Prisma AIRS platform from Palo Alto aims to offer customers end-to-end security for AI-based systems, from development to deployment.
SentinelOne, an Israeli company founded in 2013, is, like Palo Alto, intensively developing security technologies based on artificial intelligence. Despite its innovation, the company has seen its market value fall by around 12% this year and has yet to reach profitability. Reports of a potential takeover by Palo Alto, however, have caused a temporary surge in its share price.
The cyber security market is going through a period of consolidation. It is worth recalling that SentinelOne and another well-known company, Wiz, were in merger talks in 2023. This transaction ultimately failed to materialise due to a lack of agreement. More recently, Wiz became the target of a historic acquisition by Google for $32 billion.
While the Protect AI deal is a reality, the alleged interest in SentinelOne demonstrates the importance Palo Alto Networks places on dominating the rapidly growing AI-based security segment. The potential acquisition would be one of the largest deals in the history of the sector and would significantly strengthen the company’s position to compete with its main competitor, CrowdStrike.
