Google’s attempt to acquire Israeli cybersecurity startup Wiz for $23 billion has been abandoned, marking what would have been the tech giant’s largest acquisition. Wiz’s CEO, Assaf Rappaport, stated that the decision to reject Google’s offer was a difficult one but necessary for the company to focus on achieving its goal of $1 billion in annual revenue and preparing for an initial public offering (IPO).
This development comes on the heels of a significant cybersecurity incident involving CrowdStrike, which caused widespread service disruptions. Wedbush analyst Dan Ives noted that investor worries and ongoing antitrust investigations contributed to the deal’s failure. Google has faced considerable antitrust scrutiny recently and recently completed a trial concerning one of its two major cases brought by the Department of Justice.
Ives emphasized that the collapse of the deal could have broader effects on the tech sector. Despite this setback, he anticipates that Google will continue to strengthen its cybersecurity operations, a sentiment that extends to Microsoft as well.
Ives suggested that the cybersecurity sector is ripe for consolidation, predicting that Microsoft may pursue similar acquisitions to enhance its cybersecurity offerings in the next year to 18 months. Microsoft faced scrutiny after a global IT outage linked to a faulty CrowdStrike software update, which affected users worldwide. Although Ives maintains that CrowdStrike remains a leading player in cybersecurity, the incident highlights the need for Microsoft to enhance its security measures, making the void left by Google’s failed acquisition even more pronounced.