Wiz’s decision to reject Google’s acquisition offer could significantly impact Microsoft and the broader tech sector, according to analysts.
Google aimed to acquire Israeli cybersecurity company Wiz for $23 billion, but Wiz CEO Assaf Rappaport announced on Tuesday that the offer had been declined. Rappaport explained that the choice was challenging but necessary for Wiz to pursue its goal of achieving $1 billion in annual revenue and preparing for an initial public offering (IPO).
This acquisition would have strengthened Google’s cybersecurity initiatives, particularly following a recent serious outage caused by CrowdStrike, a major player in the industry. Wedbush analyst Dan Ives noted that concerns from investors and ongoing antitrust issues played a role in the deal’s collapse. Google has faced significant antitrust scrutiny and recently concluded a trial concerning one of two major cases initiated by the Department of Justice.
Ives indicated in his analysis that the failed acquisition would likely create ripple effects throughout the sector. He predicted that Google would continue to enhance its cybersecurity capabilities despite the setback with Wiz, and he expects Microsoft to also seek opportunities to strengthen its cybersecurity offerings in the coming year to 18 months.
Microsoft recently faced scrutiny after experiencing widespread disruptions from a CrowdStrike update that caused a global IT outage. Users reported issues, including the notorious “blue screens of death,” impacting businesses and even government operations.
While Ives still regards CrowdStrike as the “gold standard” in cybersecurity, the recent outage suggests that Microsoft may benefit from improving its own cybersecurity measures, further emphasized by Google’s unsuccessful attempts to acquire Wiz.