Wiz’s decision to reject Google’s $23 billion acquisition offer could significantly impact the tech landscape, particularly for Microsoft. The Israeli cybersecurity startup turned down the deal on Tuesday, as CEO Assaf Rappaport expressed a desire to focus on growing Wiz toward an annual revenue target of $1 billion and a potential IPO.
This acquisition would have strengthened Google’s cybersecurity division, especially after a major outage caused by the industry leader, CrowdStrike, last week. Analyst Dan Ives from Wedbush suggested that investor apprehensions and antitrust issues contributed to the collapse of the deal. Google has been under renewed antitrust scrutiny and recently concluded a trial related to one of two significant cases brought by the Department of Justice.
Ives stated that the failure of this acquisition would have ripple effects throughout the tech sector, predicting that Google would continue to enhance its cybersecurity capabilities despite the setback. Similarly, Microsoft is expected to pursue its own strategy for strengthening its cybersecurity platform in the next 12 to 18 months.
The recent widespread IT outage caused by a flawed update in CrowdStrike’s cybersecurity software, which affected Microsoft users globally and disrupted numerous operations, highlighted the need for improvements in this area. While Ives praised CrowdStrike as the “gold standard” in cybersecurity, he noted that this incident underscores the importance for Microsoft to bolster its cybersecurity services, especially in light of Google’s failed acquisition attempt.