Wiz’s decision to walk away from a proposed $23 billion acquisition by Google could significantly affect the technology sector, particularly Microsoft.
Wiz, an Israeli cybersecurity startup, rejected Google’s offer with CEO Assaf Rappaport stating that the choice, though difficult, was made to focus on achieving $1 billion in annual revenue and eventually pursuing an IPO. The acquisition would have strengthened Google’s cybersecurity initiatives, especially following a major outage experienced by many companies due to issues with CrowdStrike, a cybersecurity firm, which occurred just last week.
Wedbush analyst Dan Ives noted that the collapse of the deal was influenced by investor apprehensions and ongoing antitrust issues surrounding Google, which has faced intense scrutiny from regulatory bodies. After concluding a trial related to one of two major cases from the Department of Justice, Google is expected to continue investing in its cybersecurity assets.
Ives predicts that the failure of the Wiz acquisition will create broader implications in the tech industry. He indicated that Google may intensify its efforts to expand its cybersecurity initiatives, and Microsoft’s response could involve seeking its own opportunities for growth in this area within the next 12 to 18 months.
The timing is notable as Microsoft was recently in the spotlight following a widespread IT outage linked to its cybersecurity software, which is provided by CrowdStrike. This incident raised concerns, emphasizing the need for Microsoft to enhance its cybersecurity capabilities, especially in light of Google’s lost opportunity with Wiz.