Thoma Bravo is in advanced negotiations to acquire Israeli cybersecurity company Armis at a $5bn valuation, in what would mark one of the year’s largest private equity-led technology transactions, Globes reports.

Insight Partners, which acquired Armis in 2020, is expected to generate $2bn–$3bn from the deal, according to Globes. Other key investors include Georgian, G Squared, One Equity Partners, CapitalG, Brookfield, General Catalyst, and Alkeon Capital.

The proposed transaction would see Thoma Bravo assume control of Armis while injecting fresh capital to fuel its expansion. The move could also pave the way for a potential IPO, with Thoma Bravo leveraging its track record of backing pre-IPO companies, including its investment in ironSource.

Armis, founded by Yevgeny Dibrov and Nadir Izrael, focuses on cybersecurity solutions for critical infrastructure, industrial systems, and medical devices. The company has raised over $800m since 2020, recently reaching an annual recurring revenue of $300m, a $100m increase from last year.

Despite strong growth, Armis’s current valuation multiple of 16–17x ARR is considered modest compared with recent cybersecurity acquisitions such as Wiz and Dazz.

For Insight Partners, the exit provides a timely liquidity event as the firm raises its 13th fund, while Thoma Bravo sees an opportunity to back a category leader with potential for public markets.

Armis counts Colgate-Palmolive, United Airlines, and the US Postal Service among its global clients and employs 900 people worldwide.

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