Wiz’s decision to reject Google’s acquisition offer could have significant repercussions for the tech industry, particularly for Microsoft.
Google was seeking to acquire the Israeli cybersecurity firm Wiz for $23 billion, but the deal fell through when Wiz CEO Assaf Rappaport chose to decline the offer. Rappaport stated that this difficult choice was made in order to focus on building Wiz towards achieving $1 billion in annual revenue and preparing for an initial public offering.
The acquisition would have strengthened Google’s cybersecurity division, especially after a major outage last week involving renowned cybersecurity company CrowdStrike. Analyst Dan Ives of Wedbush noted that the collapse of the deal was influenced by investor worries and ongoing antitrust issues facing Google, which has recently concluded a trial related to two significant cases from the Department of Justice.
Ives commented that the failure of this deal would have a ripple effect across the entire sector. He anticipated that Google would continue to aggressively expand its cybersecurity presence, a move likely mirrored by its competitor Microsoft.
Ives also pointed out the pressing need for consolidation within the cybersecurity industry and suggested that Microsoft may pursue its own enhancements to its cybersecurity platform in the next 12 to 18 months.
Microsoft previously faced negative attention due to a global IT outage linked to a faulty update from Cybersecurity software provider CrowdStrike. Users worldwide reported encountering system failures, which led to disruptions in business operations, flights, and government services. While Ives maintains that CrowdStrike remains a top player in cybersecurity, the recent outage emphasizes the potential benefits for Microsoft in further developing its cybersecurity framework, particularly following the failed Google acquisition.