Okta announced today that it has acquired Auth0, a platform used to develop secure identities for internet applications. The deal is valued at an estimated $6.5 billion. Under the terms of the deal, Okta provided $267.7 million in cash, equity awards worth approximately $700.2 million, and 20.4 million of it’s class A shares.
This is a deal that has been a very long time coming. Okta made its initial bid for Auth0 some 8 years ago, and since then Okta has alternated between offering buyouts and attempting to directly outcompete Auth0. Eventually, Okta share prices swelled from $107.29 in March of last year to 239.61 in March of this year, and Okta was able to make the high-value, primarily-stock offer that went through today.
Both companies are big players in the secure identity market, which is currently valued at $55 billion. The industry is a highly technical one, but in short, the services of companies like Auth0 allow companies to optimize consumer tracking and data collection while keeping those consumers safe online. Acquiring Auth0 will ultimately allow Okta to take advantage of Auth0’s great reputation among developers and expand further into this rapidly expanding market.