Wiz’s decision to reject Google’s acquisition offer could significantly affect the technology landscape, particularly for Microsoft.
Google’s plan to acquire the Israeli cybersecurity firm Wiz for $23 billion has fallen through after Wiz CEO Assaf Rappaport opted against the deal. He stated that this difficult choice stemmed from his desire to focus on growing Wiz towards $1 billion in annual revenue and preparing it for an eventual public offering.
This acquisition would have enhanced Google’s cybersecurity capabilities, especially following recent upheaval in the industry marked by a major outage at CrowdStrike. The setback did not escape attention from analysts, with Wedbush’s Dan Ives highlighting that investor apprehension and mounting antitrust concerns led to the collapse of the deal. Google has faced considerable antitrust scrutiny and recently concluded a trial regarding one of two significant cases against it by the Department of Justice.
Ives anticipated that the repercussions of this stalled deal would resonate throughout the cybersecurity sector. Despite the loss of the Wiz acquisition, he believes Google will remain committed to expanding its cybersecurity offerings, a trend mirrored by rival Microsoft.
Ives noted that consolidation in the cybersecurity space has become essential and predicted that Microsoft will seek to enhance its cybersecurity portfolio in the next 12 to 18 months. Microsoft has recently been under scrutiny following a global IT outage related to a faulty update from CrowdStrike, which employs Microsoft’s systems for cybersecurity. During this incident, users faced significant disruptions, indicating that strengthening their cybersecurity capabilities could be crucial for Microsoft moving forward.