(Bloomberg) -- Cybersecurity startup Armis is buying a threat intelligence firm that uses artificial intelligence to set traps for hackers. 

Armis said Wednesday it has agreed to buy CTCI, a closely held company that uses AI to run a self-learning and self-adapting network of “honeypots” that can simulate the systems of businesses and institutions. The goal is to lure hackers and learn enough about their tactics to build defenses and avert real threats, said Nadir Izrael, Armis’ chief technology officer. The company didn’t disclose the exact value of the deal, but said it was worth less than $20 million. 

The deal is part of Armis’ broader strategy to expand its product offerings by both building and buying technologies. It comes as the company prepares for an initial public offering. The startup was last valued at $3.4 billion after a $300 million funding round in 2021.

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With the CTCI takeover, San Francisco-based Armis is adding a predictive threat intelligence product to its lineup, Chief Executive Officer Yevgeny Dibrov said in an interview. “But there’s more coming,” he said, signaling that the company is in the market for more deals that it sees as good fits. ‘We’ll continue having more products.” 

Armis, which helps companies map out their assets and connected devices to gain more visibility into the security of their networks, plans to combine its data with CTCI’s technology to create even more convincing honeypots or traps. That integration will serve as the foundation of the company’s new advanced early warning system that will alert Armis’ clients to emerging threats. 

“We can deploy very real-looking hospitals out there that capture attacks, either targeted or otherwise,” Izrael said. “And then we take whatever comes in from there and model it right back into the defensive.”

Armis, which was founded by veterans of the Israeli cyber intelligence Unit 8200, plans to charge customers annually for the early warning system, Dibrov said, adding that the company is still discussing the right pricing model for the product.

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