Wiz’s decision to decline Google’s $23 billion acquisition offer is poised to have significant repercussions for the tech industry, particularly for Microsoft.
The Israeli cybersecurity startup Wiz, led by CEO Assaf Rappaport, opted to turn down the offer to focus on growing the company with an aim of achieving $1 billion in annual revenue and pursuing an initial public offering (IPO). This rejection comes at a time when the cybersecurity landscape is increasingly tumultuous, especially in light of a recent major outage caused by CrowdStrike, a prominent player in the industry.
Analyst Dan Ives from Wedbush highlighted that the collapse of the acquisition deal stemmed from investor worries and ongoing antitrust challenges that Google faces. Google has been under intense scrutiny, recently concluding a trial related to one of two significant antitrust cases from the Department of Justice.
Ives noted in a report that the fallout from this deal will have ripple effects throughout the sector. He speculated that despite the setback with Wiz, Google will likely intensify its efforts to expand its cybersecurity capabilities. Microsoft is also expected to respond proactively.
Ives indicated that the cybersecurity sector is ripe for consolidation and predicted that Microsoft may take steps to enhance its cybersecurity offerings in the next 12 to 18 months. This comes after Microsoft faced scrutiny during a widespread global IT outage triggered by a problematic update to CrowdStrike’s cybersecurity software, which impacted numerous Windows users worldwide.
While CrowdStrike remains regarded as a leader in cybersecurity, the incident has raised questions about Microsoft’s cybersecurity approach, suggesting that the failed acquisition could pave the way for Microsoft to enhance its own cybersecurity initiatives further.