Thoma Bravo Selling Venafi to CyberArk for $1.54 Billion

Private-equity firm Thoma Bravo is selling machine identity management provider Venafi to CyberArk.

The deal, tabulated at $1.54 billion, pairs Venafi's certificate life-cycle management and other machine identity-focused technologies with CyberArk’s secrets management capabilities. Venafi's other services include private public key infrastructure (PKI).

The deal consists of about $1 billion in cash and about $500 million in stock. It will close in the second half of 2024, the companies said.

Thoma Bravo in 2020, when it made a strategic growth investment in Venafi, valued the company at $1.15 billion. At the time, it had acquired a majority stake in Venafi.

“Over the course of our investment, Venafi has accelerated SaaS growth, expanded margins, and successfully created a best-in-class SaaS offering, setting the stage for continued innovation," Thoma Bravo partner Chip Virnig said. "We believe CyberArk is a great partner for Venafi and that the scaled end-to-end machine identity security platform created by this strategic combination will deliver significant value to shareholders.”

Thoma Bravo's Chip Virnig

Venafi-CyberArk Deal

Whereas CyberArk focuses on humanity identity security to control privileges and prevent data misuse, Venafi brings in a focus on machines and devices. CyberArk executives estimate that their total addressable market has expanded from about $50 billion to $60 billion through adding this machine focus.

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CyberArk's Matt Cohen

“This acquisition marks a pivotal milestone for CyberArk, enabling us to further our vision to secure every identity – human and machine – with the right level of privilege controls,” CyberArk CEO Matt Cohen said. “By combining forces with Venafi, we are expanding our abilities to secure machine identities in a cloud-first, GenAI, post-quantum world.

The companies said that 95% of its revenue is recurring, thanks to software-as-a-service (SaaS) and term-based licensing. Venafi reportedly drives about $150 million annual recurring revenue.

Thoma Bravo M&A

Thoma Bravo's flipping of Venafi comes a month after the private equity company announced the acquisition of Darktrace. That deal was worth $5.32 billion.

There's no shortage of cybersecurity-related wheeling and dealing taking place in the Thoma Bravo portfolio.

Exabeam last week said it was buying Thoma Bravo's LogRhythm. In March, Thoma Bravo-backed Delinea (formerly known as Centrify) said it was buying Fastpath from Pamlico Capital, four years after Pamlico made a growth investment in Fastpath.