Wiz’s decision to reject Google’s acquisition offer could significantly affect Microsoft and the broader tech landscape.
The Israeli cybersecurity startup had been poised for a remarkable deal, as Google aimed to acquire it for $23 billion. However, Wiz CEO Assaf Rappaport announced the tough choice to decline the offer to focus on building Wiz’s revenue to $1 billion annually and eventually pursue an IPO.
This move would have strengthened Google’s cybersecurity portfolio, particularly after a significant outage caused by CrowdStrike, an industry leader, recently shook the cybersecurity sector. According to Wedbush analyst Dan Ives, the deal fell through due to investor apprehensions and antitrust challenges. Google has been under considerable antitrust scrutiny and recently concluded a trial linked to one of two major Department of Justice cases against the company.
Ives indicated that the fallout from this no-deal situation will reverberate throughout the tech sector. He believes that Google will persist in enhancing its cybersecurity initiatives despite the setback with Wiz, and its competitor, Microsoft, is likely to follow suit.
Ives predicted that consolidation is overdue in the cybersecurity field, suggesting that Microsoft may seek to strengthen its cybersecurity offerings in the upcoming 12 to 18 months.
The recent global IT outage—triggered by a problematic update to cybersecurity software from CrowdStrike that impacted Microsoft—has put the company in the spotlight for all the wrong reasons. Users worldwide experienced significant disruptions, leading to public outcry. While Ives still regards CrowdStrike as the “gold standard” in cybersecurity, the incident hints at the necessity for Microsoft to fortify its cybersecurity platform, creating even more opportunities after Google’s failed acquisition attempt.