Google’s attempt to secure its largest acquisition has fallen through after Israeli cybersecurity startup Wiz rejected a $23 billion offer. The decision, announced by Wiz CEO Assaf Rappaport, aims to refocus the company on achieving $1 billion in annual revenue and preparing for an initial public offering (IPO).
This move comes in the wake of a significant cybersecurity incident caused by CrowdStrike, which raised concerns within the tech sector about digital security. Following the news of the failed acquisition, Wedbush analyst Dan Ives highlighted that investor apprehensions and antitrust issues likely contributed to the breakdown of negotiations. Google has been under heavy scrutiny from regulators and recently concluded a trial related to antitrust allegations filed by the Department of Justice.
Ives noted that the inability to close this deal will have broader implications across the tech industry. He expects Google to intensify efforts to expand its cybersecurity capabilities, as will Microsoft, its main competitor.
In light of the disruption caused by recent cyber incidents, such as a global IT outage linked to a faulty CrowdStrike update affecting Microsoft software, Ives pointed out that consolidation in the cybersecurity market is necessary. He anticipates that Microsoft will seek to strengthen its cybersecurity offerings over the next year to 18 months. Despite the CrowdStrike setback, which has called into question some of its operational reliability, Ives still considers the company a leader in the cybersecurity space. The failure of Google’s Wiz deal creates further opportunities for Microsoft’s growth in that sector.