Palo Alto Networks Buying Cloud Security Firm RedLock for $173M

Palo Alto Networks is expanding its cloud security capabilities with acquisition of RedLock, a Menlo Park, California-based company that helps clients stay secure when using public clouds like Amazon Web Services or Microsoft Azure.

Publicly traded Palo Alto announced Wednesday an agreement to acquire RedLock for $173 million in cash. The deal is expected to close before the end of the month.

RedLock has developed sophisticated analytics capabilities, capturing disparate data sets (such as cloud resource configuration, network traffic, and third-party feeds) and correlating them to detect threats and vulnerabilities. It also automates threat remediation.

This is Palo Alto’s second acquisition this year. In March, it paid $300 million for Evident, which continuously monitors clients’ cloud infrastructure configuration to ensure they remain compliant.

Both deals are part of a single strategic move by Palo Alto to combine cloud security and compliance into one. Think of it as a single software suite that has all the features for managing security across your AWS and Azure environments, while also ensuring that you’re using those public clouds in a way that’s compliant with something like GDPR.

Palo Alto plans to merge RedLock’s analytics and threat detection capabilities with Evident’s security and compliance monitoring into a single cloud security offering, which it expects to launch early next year, according to the announcement.

Palo Alto reported $2.3 billion in revenue for fiscal 2018 (ended in July) – up 29 percent from the previous year – and a net loss of $148 million – down from $217 million in fiscal 2017.