Wiz’s decision to decline Google’s acquisition offer could significantly impact Microsoft and the broader tech industry. Google aimed to acquire the Israeli cybersecurity firm Wiz for $23 billion, but after a careful consideration, Wiz CEO Assaf Rappaport announced the choice to reject the offer to pursue the goal of generating $1 billion in annual revenue and moving towards an IPO.
This acquisition would have enhanced Google’s cybersecurity efforts, especially following a notable outage linked to CrowdStrike, an incident that has raised concerns within the industry. Analyst Dan Ives from Wedbush highlighted that worries from investors and antitrust issues contributed to the deal falling through. Google is currently under substantial antitrust scrutiny and has concluded a trial related to one of two major cases from the Department of Justice.
Ives projected that the cancellation of the acquisition would have widespread repercussions within the sector. Despite this setback, he indicated that Google would likely continue to expand its cybersecurity capabilities, a trend that is also expected from Microsoft.
He noted, “We believe consolidation is overdue in the cybersecurity sector and we would expect Microsoft to potentially pursue enhancements to its own cybersecurity platform over the coming 12 to 18 months.” Microsoft recently experienced scrutiny itself due to a significant global IT outage resulting from a faulty update to its cybersecurity software provided by CrowdStrike, which affected many of its users worldwide.
While Ives maintains that CrowdStrike remains a leader in cybersecurity, the recent outage may suggest that Microsoft should strengthen its cybersecurity services, further opening opportunities following Google’s failed acquisition of Wiz.