Google’s attempt to acquire Israeli cybersecurity firm Wiz for $23 billion has officially fallen through, a decision that could significantly influence the technology sector, particularly Microsoft. Wiz’s CEO, Assaf Rappaport, announced the difficult decision to reject Google’s offer in order to focus on growing the company towards achieving $1 billion in annual revenue and preparing for an initial public offering (IPO).
This acquisition would have enhanced Google’s cybersecurity capabilities, especially following a substantial outage caused by CrowdStrike, another major player in the cybersecurity industry, last week. Wedbush analyst Dan Ives indicated that concerns over investor sentiment and antitrust issues contributed to the termination of the deal. Google is currently facing intense antitrust scrutiny, highlighted by its recent trial linked to two significant cases from the Department of Justice.
Ives noted that the cancellation of the Wiz acquisition would create ripple effects throughout the sector. He believes Google will continue to aggressively expand its cybersecurity presence despite the setback, a sentiment that also applies to its competitor, Microsoft.
Ives mentioned that there has been a pressing need for consolidation within the cybersecurity landscape, suggesting that Microsoft may seek to strengthen its cybersecurity offerings in the next 12 to 18 months. The tech giant was recently in the news due to a global IT outage, attributed to a problematic update in CrowdStrike’s cybersecurity software, which affected many users and disrupted operations across various sectors.
Even though Ives maintains that CrowdStrike remains a leading authority in cybersecurity, the incident may prompt Microsoft to enhance its own cybersecurity strategies, creating further opportunities in the market following Google’s failed acquisition attempt.