Palo Alto Networks eyes $500 million Clutch Security acquisition

Palo Alto Networks (NASDAQ:PANW) is reportedly negotiating to acquire Clutch Security for $500 million in cash, plus additional milestone-based payments, in a deal targeting technology that protects AI agents' access to enterprise systems.

The proposed valuation represents a significant increase from Clutch's $85 million valuation in January 2025, when it raised a $20 million Series A funding round led by Lightspeed and SignalFire, while the startup is approaching $10 million in annual recurring revenue.

Neither company confirmed an agreement, and Palo Alto Networks declined to comment on the reported discussions, which could still end without a transaction; Clutch also did not respond to requests for comment.

Clutch develops cybersecurity software that tracks and protects credentials, passwords, authentication codes and permissions used by AI agents to access corporate applications and data, addressing security risks associated with non-human digital identities.

The proposed acquisition would expand Palo Alto Networks' identity security and AI protection capabilities.