Microsoft Reportedly Buys Israeli Cloud Security Firm for $320M

An Israeli startup focused on cloud application security is reportedly the next addition to Microsoft ever-expanding stable of acquisitions. Adallom, which is headquartered in Palo Alto and has a research-and-development facility based in Tel Aviv, has been acquired by Microsoft for $320 million in cash, according to news reports.

If confirmed, the acquisition -- reported by Israeli financial publications Globes and The Calcalist -- would be Microsoft's largest to date in Israel. However, it's hardly the first: in just the past nine months Redmond has purchased three other Israeli tech firms.

Founded in 2012 with $4.5 million in Series A funding led by Sequoia Capital, Adallom is led by three veterans of the Israeli Intelligence Corps: co-founders Assaf Rappaport (pictured above), who is CEO; Ami Luttwak, CTO; and Roy Reznik, vice president of research and development. The company's technology provides security for enterprises that use cloud-based, software-as-a-service (SaaS) applications for CRM, ERP, collaboration, storage and other tasks.

A 'Cloud Access Security Broker'

We reached out to Microsoft and Adallom for confirmation of the pending acquisition. We did not receive a response from Adallom, and a Microsoft spokesperson declined comment.

Adallom has said its solutions are designed to help enterprises "secure data in any cloud." The company has described itself as a "cloud access security broker" for businesses using services from Salesforce, Dropbox, Box, Office 365 and other SaaS and IaaS (infrastructure-as-a-service) application providers.

In December 2013, the company revealed it had discovered a severe vulnerability in Microsoft Office 365 that posed a risk for users of Office 2013 Desktop. First observed in April of that year, the vulnerability was described by Adallom chief software architect Noam Liran as "a bona fide perfect crime; a crime where the victim doesn't know that heEUs been hit; a crime where there's no proof of any...

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