Shares of Palo Alto Networks rose on Monday following a Nasdaq Trader notice outlining the provisional timeline for its pending acquisition of identity security firm CyberArk. The update indicates the deal is scheduled to close just before the market opens on February 11.
Palo Alto Networks stock climbed 3.4% to $164.81 during the session, while CyberArk shares gained 4.0% to $407.38. Trading in CyberArk is set to be halted after-hours on February 10, with a formal suspension expected on February 12.
Under the merger terms announced in July 2025, CyberArk shareholders will receive $45 in cash plus 2.2005 shares of Palo Alto Networks for each share they own. The transaction carries an approximate $25 billion valuation and marks Palo Alto's strategic expansion into the identity security market.
The impending closure has drawn attention from arbitrage funds, which often buy shares of the target company and short the acquirer to capture the deal spread. This activity can heighten near-term volatility for both stocks, as the final consideration for CyberArk holders remains partially tied to fluctuations in Palo Alto's share price.
Some investors have expressed concerns about potential earnings dilution, as Palo Alto will issue new shares to fund the acquisition. However, proponents argue the combination significantly strengthens the company's capabilities in a critical enterprise security segment.
Market participants are now looking ahead to Palo Alto Networks' fiscal second-quarter earnings report, scheduled for after the market closes on February 17. Analysts will scrutinize the results for insights into broader demand trends and early details on the CyberArk integration process.
It is important to note that Nasdaq has labeled the closing date as tentative. Any last-minute regulatory, operational, or procedural hurdles could delay the transaction and impact both stocks.
