Google’s ambitious plan to acquire the Israeli cybersecurity startup Wiz for $23 billion has come to a halt, marking a significant turn in the tech industry with potential effects on major players like Microsoft. Wiz’s CEO, Assaf Rappaport, made the difficult decision to reject Google’s offer, aiming instead to focus on growing Wiz towards its goal of reaching $1 billion in annual revenue and pursuing an initial public offering.
This acquisition would have strengthened Google’s position in the cybersecurity arena, especially following a week that saw major disruptions in the industry due to a significant outage linked to CrowdStrike. Analyst Dan Ives from Wedbush noted that both investor skepticism and ongoing antitrust investigations were key reasons the deal fell apart. Google has faced heightened scrutiny from regulators and recently concluded one of its two significant cases with the Department of Justice.
Ives highlighted that the failure of the Wiz acquisition could lead to wider repercussions across the cybersecurity sector. Despite this setback, he anticipates that Google will intensify its efforts to expand its cybersecurity capabilities, a strategy likely to be mirrored by its rival Microsoft.
Following the CrowdStrike incident, which severely affected global operations and highlighted vulnerabilities, Microsoft is expected to seek to enhance its cybersecurity offerings. Ives remarked that the cybersecurity sector is ripe for consolidation and that Microsoft could pursue acquisitions to strengthen its platform over the next year or two.