Palo Alto Networks Will Buy Attack Surface Management Company Expanse for $800M

Cybersecurity company Palo Alto Networks announced an agreement this week to buy attack surface management company Expanse Inc. in a deal valued at up to $800 million.

The terms of the deal include $670 million to be paid in cash and Palo Alto stock and about $130 million in replacement equity awards.

Expanse was founded in 2012 and has raised $136 million, according to Crunchbase. Its most recent raise was a $70 million Series C in 2019.

The company is planning to add the Expanse platform to its Cortex product suite. Expanse provides a service to help companies understand and protect their attack surface, where they could be most vulnerable to attack. The platform works by giving the security team a view of how the company’s security profile could look to an attacker trying to gain access.

Palo Alto’s plan is to fold Expanse into its Cortex Suite, an AI-driven set of tools designed to detect and prevent attacks in an automated way. Expanse should provide Palo Alto with a highly valuable set of data to help feed the AI models.

The deal is expected to close in Palo Alto’s fiscal second quarter, which ends January, assuming it passes regulatory muster.

“By integrating Expanse’s attack surface management capabilities into Cortex after closing, we will be able to offer the first solution that combines the outside view of an organization’s attack surface with an inside view to proactively address all security threats,” said Palo Alto Chief Executive Nikesh Arora.

He added, “We believe this will be a game-changer in security operations.”

“Joining forces with Palo Alto Networks will let us achieve our most important business goals years ahead of schedule. During the course of conversations with Palo Alto Networks leadership, we shared optimism that the right combination of technology and people can solve many cybersecurity challenges that to date have seemed intractable,” Expanse’s founders wrote in a blog post announcing the deal.

Co-founders, Dr. Tim Junio and Dr. Matt Kraning, will be joining Palo Alto under the terms of the deal.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.