Wiz’s decision to back out of the proposed $23 billion acquisition by Google could have significant consequences for Microsoft and the tech industry as a whole. Wiz, an Israeli cybersecurity startup, turned down Google’s offer in favor of focusing on its growth towards achieving $1 billion in annual revenue and preparing for an initial public offering (IPO), according to CEO Assaf Rappaport.
The acquisition would have strengthened Google’s presence in the cybersecurity sector just as concerns were rising following a major outage linked to CrowdStrike, a leading cybersecurity firm. Wedbush analyst Dan Ives noted that investor anxiety and antitrust issues contributed to the breakdown of the deal, reflecting growing scrutiny on Google, which has recently concluded a trial related to two significant antitrust cases from the Department of Justice.
Ives emphasized that the failure of the Wiz acquisition could lead to broader ramifications across the cybersecurity landscape. He expects Google to intensify its efforts to enhance its cybersecurity capabilities, while he suggests that Microsoft may also seek to strengthen its own cybersecurity offerings in the coming year to 18 months. This call for consolidation in the cybersecurity sector follows a recent global IT outage caused by a faulty CrowdStrike update, which severely disrupted operations for companies and government entities relying on Microsoft’s systems.