Wiz’s decision to reject Google’s acquisition offer could significantly impact the tech sector, particularly Microsoft.
Google intended to acquire the Israeli cybersecurity startup Wiz for $23 billion, but the offer was turned down by Wiz on Tuesday. CEO Assaf Rappaport described the choice as “tough,” emphasizing the company’s goal to reach $1 billion in annual revenue and pursue an initial public offering (IPO) instead.
This acquisition would have strengthened Google’s cybersecurity division, especially following a recent outage caused by industry player CrowdStrike. Analyst Dan Ives from Wedbush noted that concerns among investors and antitrust issues contributed to the deal’s collapse. Google has faced intense scrutiny regarding antitrust concerns and recently concluded a significant trial involving the Department of Justice.
Ives stated in a message to investors that the fallout from this failed acquisition will have broader implications for the sector. He anticipates that Google will continue to focus on expanding its cybersecurity offerings despite losing Wiz, and he expects Microsoft to also seek to enhance its cybersecurity services in the next 12 to 18 months.
Microsoft recently experienced negative attention from a global IT outage linked to a faulty update from CrowdStrike, which affected its Windows operating systems. This incident showed the importance of robust cybersecurity measures and highlighted the need for Microsoft to improve its security solutions in light of ongoing challenges in the sector.