Wiz’s decision to back out of a deal with Google could significantly impact the tech industry, especially Microsoft. The planned acquisition of the Israeli cybersecurity startup for $23 billion was set to be one of Google’s largest ever, but Wiz CEO Assaf Rappaport announced that he would not proceed with the offer. Rappaport described this as a difficult choice, emphasizing Wiz’s ambition to reach $1 billion in annual revenue and future plans for an IPO.
This deal was seen as a move to strengthen Google’s cybersecurity position following a recent major outage attributed to CrowdStrike, a leading cybersecurity firm. According to Wedbush analyst Dan Ives, the failed acquisition stemmed from investor apprehensions and ongoing antitrust challenges faced by Google, which is currently dealing with significant scrutiny and has just concluded a trial related to antitrust cases from the Department of Justice.
Ives noted that the repercussions of the deal’s cancellation are likely to resonate throughout the industry. He predicts that Google will nonetheless strive to expand its cybersecurity capabilities while its competitor, Microsoft, may also seek to enhance its own cybersecurity offerings in the next year to year and a half.
Microsoft recently faced criticism due to a global IT outage linked to a malfunction in CrowdStrike’s cybersecurity software, which affected numerous users and led to widespread disruptions. Despite calls for Microsoft to strengthen its cybersecurity division, Ives maintains that CrowdStrike remains at the top of the field. The collapse of the Google-Wiz deal may provide Microsoft with additional opportunities to enhance its cybersecurity initiatives.