The potential acquisition of Israeli cybersecurity startup Wiz by Google, valued at $23 billion, has fallen through. Wiz’s CEO, Assaf Rappaport, announced the decision on Tuesday, stating that the company aims to focus on reaching $1 billion in annual revenue and plans for an initial public offering (IPO) instead of accepting Google’s offer.
This development comes at a time when the cybersecurity sector is gaining increased attention, particularly after a significant outage caused by CrowdStrike, a major player in the industry, which raised concerns about cybersecurity reliability. Analyst Dan Ives from Wedbush shared insights on the implications of the rejected deal, mentioning that investor apprehensions and ongoing antitrust concerns played a significant role in the downfall of negotiations. Google has been under heavy scrutiny regarding antitrust issues and recently concluded a trial related to one of two significant cases from the Department of Justice.
Ives expressed that the failed acquisition would likely have ramifications throughout the technology sector, particularly affecting cybersecurity approaches. He noted that Google would likely persist in expanding its cybersecurity efforts despite the setback with Wiz, and added that Microsoft might seek to enhance its own cybersecurity capabilities in the near future.
This comes in the wake of a global IT outage linked to a faulty CrowdStrike update, which disrupted services for Microsoft users, highlighting the vulnerabilities within the cybersecurity landscape. While Ives acknowledged CrowdStrike’s strong reputation, he indicated that this incident suggests Microsoft should strengthen its cybersecurity offerings, further opened by Google’s unsuccessful deal for Wiz.