TEL AVIV (Reuters) – Online payments company PayPal, a unit of eBay, is establishing a cyber security center in Israel and has bought local start-up CyActive to help launch the development.
PayPal, which is slated to split from eBay later this year, did not disclose financial details but Israeli media have said the acquisition was worth $60 million.
“Located in one of the world’s top cybersecurity hubs, this new security center will allow us to tap into the country’s cutting-edge technology and top cybersecurity talent,” PayPal chief technology officer James Barrese wrote in a blog on the company’s website.
CyActive, which can predict how malicious software will develop and offer companies detection and prevention, had received a strategic investment from the venture capital unit of
Germany company Siemens (SIEGn.DE: Quote, Profile, Research, Stock Buzz) in September. Financial details were not disclosed.
Siemens joined Jerusalem Venture Partners (JVP), an Israeli venture capital firm, in investing in CyActive. JVP was the main
shareholder in another cyber security company, CyberArk Software, which went public on Nasdaq in September.
Israel’s dedication to developing its defense capabilities has been extended to cyberspace in recent years, spawning an industry which has attracted a near four-fold increase in venture capital investment since 2010.
Besides jumpstarting the security center, Barrese said the acquisition of CyActive will add “future-proof technology” to PayPal’s security platform.
This is PayPal’s second acquisition in Israel, after it bought FraudSciences, which monitors financial fraud, in 2008
for $169 million. PayPal has a fraud and risk detection center in Tel Aviv.