Google’s attempt to acquire Israeli cybersecurity startup Wiz for $23 billion has come to an end, which could significantly affect the technology sector, particularly Microsoft. Wiz’s CEO, Assaf Rappaport, announced the decision to reject Google’s offer in order to focus on growing the company towards reaching $1 billion in annual revenue and pursuing an initial public offering (IPO).
The failure of this deal comes in the wake of a major cybersecurity incident involving CrowdStrike, which disrupted operations across various industries. Dan Ives, an analyst from Wedbush, noted that the deal fell apart due to investor concerns and ongoing antitrust investigations that Google is facing, following its recent trial related to two significant cases from the Department of Justice.
Ives pointed out that the cancellation of the acquisition could have widespread implications across the tech industry. He anticipates that Google will continue to invest heavily in expanding its cybersecurity offerings, a move that may also be mirrored by Microsoft. He emphasized that consolidation in the cybersecurity sector is necessary and predicted that Microsoft might pursue growth opportunities in this area within the next year to 18 months.
Microsoft found itself in the spotlight due to a major global IT outage linked to a faulty update of its cybersecurity software from CrowdStrike. This incident, which led to widespread disruptions, indicates that reinforcing its cybersecurity capabilities could be crucial for Microsoft, especially now that the opportunity from the failed Wiz deal has emerged.