Zscaler on Tuesday said it had agreed to buy Red Canary, a leading provider of managed detection and response technology.
Zscaler, a top cloud security vendor, said the agreement will help it disrupt competitors’ legacy security operations.
The parties did not disclose the financial terms of the agreement, which is expected to close by August, but Zscaler is expected to disclose additional info when it reports earnings on Thursday.
“The proposed acquisition of Red Canary is a natural expansion of our capabilities into managed detection and response and threat intelligence to accelerate our vision of AI-powered SOC of the future,” Jay Chaudhry, Zscaler’s founder, chairman and CEO, said in a statement.
The agreement lets Zscaler fill two significant gaps in its security portfolio, including endpoint visibility and identity-based visibility, according to Jeff Pollard, vice president and principal analyst at Forrester.
“When you think about it, the network has ultimately been highly deprioritized from a detection and response perspective,” Pollard told Cybersecurity Dive. “Endpoint is kind of where it was, and now identity is kind of where it is.”
Red Canary, however, was battling in a highly competitive MDR market for years and had some difficulty scaling up operations on its own, Pollard said.
Zscaler says it protects nearly 45% of Fortune 500 companies and processes more than 500 billion transactions on a daily basis.
Red Canary serves almost 1,000 different enterprises across various industries, ranging from Fortune 500 firms to local school districts, according to a blog post from co-founder and CEO Brian Beyer.
Beyer said the company’s products will continue to integrate with more than 200 existing technology and security products.
The agreement marks the latest in a series of acquisitions by Zscaler over the past few years. The company in February 2023 acquired Israeli startup firm Caconic, a SaaS specialist in supply chain security.
Zscaler then acquired two firms in early 2024, Avalor (for a reported $310 million) and Airgap Networks (under terms that were not disclosed).
The agreement Tuesday came on the same day as Check Point Software Technologies agreed to buy Veriti Cybersecurity, a specialist in threat exposure management.
