Wiz’s decision to decline Google’s acquisition offer is expected to significantly impact the technology sector, particularly Microsoft.
Wiz, an Israeli cybersecurity startup, turned down Google’s proposal to purchase the company for $23 billion. CEO Assaf Rappaport stated that the choice was difficult but necessary for Wiz to focus on achieving $1 billion in annual revenue and preparing for an initial public offering.
The acquisition was aimed at strengthening Google’s cybersecurity division following a recent major outage linked to cybersecurity firm CrowdStrike. Wedbush analyst Dan Ives noted that concerns from investors and ongoing antitrust matters were factors contributing to the deal’s failure. Google has faced heightened antitrust scrutiny and recently concluded a trial from the U.S. Department of Justice.
Ives expressed that the abandonment of the deal would have broader repercussions throughout the tech sector. He anticipates that Google will continue to enhance its cybersecurity efforts, and the same could be expected from Microsoft.
Ives suggested that consolidation is necessary in the cybersecurity field and indicated that Microsoft might seek to enhance its cybersecurity capabilities over the next 12 to 18 months. This comes on the heels of negative attention for Microsoft due to a widespread IT outage caused by an update from CrowdStrike, a firm it collaborates with in cybersecurity. The disruption led to significant operational issues worldwide, further highlighting the need for Microsoft to strengthen its cybersecurity framework, especially with Google’s failed acquisition of Wiz.