Cybersecurity company Palo Alto Networks is buying CyberArk in a cash-and-stock deal valued at approximately $25 billion.

CyberArk, which is based in Petach-Tikva, Israel, develops software that detects attacks on privileged accounts.

CyberArk shareholders will receive $45 in cash and 2.2005 shares of Palo Alto Networks common stock for each share of CyberArk that they own.

Palo Alto Networks Inc. said Wednesday that the transaction will give it access to the identity security market.

"Our market entry strategy has always been to enter categories at their inflection point, and we believe that moment for identity security is now," Palo Alto Networks Chairman and CEO Nikesh Arora said in a statement. "This strategy has guided our evolution from a next-gen firewall company into a multi-platform cybersecurity leader."

Wedbush analyst Dan Ives called the acquisition a "strategic home run," saying in a note to clients that Palo Alto Networks is looking "to build an all-in-one shop for all cyber solutions to battle the rising threats from AI while injecting this technology into its broader portfolio."

Separately CyberArk reported financial results, including revenue growth of 46% in the second quarter. Adjusted profit of 88 cents per share beat the average analyst estimate.

The announcement is the latest buyout in the cybersecurity space this year. In March Google said that it had struck a deal to buy cybersecurity firm Wiz for $32 billion in what would be the tech giant's biggest-ever acquisition.

The boards of both Palo Alto Networks and CyberArk have unanimously approved the deal, which is expected to close during the second half of Palo Alto Networks' fiscal 2026. The transaction still needs approval from CyberArk shareholders.

Shares of Palo Alto Networks, which is based in Santa Clara, California, dropped nearly 8% in morning trading. CyberArk's stock declined 1.8%.