Wiz’s decision to walk away from a deal with Google, which would have been the tech giant’s largest acquisition yet, could have significant repercussions for the industry, particularly for Microsoft.
Wiz, an Israeli cybersecurity startup, turned down Google’s $23 billion acquisition offer, according to CEO Assaf Rappaport. He stated that the challenging choice was made to focus on growing Wiz towards its target of achieving $1 billion in annual revenue and preparing for an eventual IPO.
This decision comes at a pivotal moment, as Google’s cybersecurity business was recently impacted by a major outage from CrowdStrike, another key player in the industry. Following the news of the failed acquisition, Wedbush analyst Dan Ives noted that concerns from investors and ongoing antitrust issues likely contributed to the breakdown of the deal. Google has faced increasing scrutiny over its market practices and recently concluded a trial related to antitrust matters pursued by the Department of Justice.
Ives indicated that the cancellation of the acquisition would have far-reaching effects across the cybersecurity sector. He suggested that Google will likely focus on expanding its cybersecurity capabilities despite the loss of the Wiz deal, and similarly, Microsoft may also seek to enhance its cybersecurity offerings in the coming months.
Additionally, Microsoft found itself in the limelight after a widespread IT outage impacted users globally, attributed to a faulty update from CrowdStrike—a company that Microsoft relies on for cybersecurity measures. This incident highlighted the need for Microsoft to strengthen its cybersecurity position, and the failure of Google’s acquisition of Wiz could further motivate such efforts.