Wiz’s decision to turn down Google’s acquisition offer could have significant ramifications for Microsoft and the broader tech industry. The Israeli cybersecurity startup was approached by Google for a substantial $23 billion deal, which Wiz CEO Assaf Rappaport ultimately declined in order to focus on scaling the company towards $1 billion in annual revenue and pursuing an IPO.
This acquisition would have enhanced Google’s cybersecurity capabilities, especially in light of a recent major outage experienced by CrowdStrike, a well-known player in the industry. Analyst Dan Ives from Wedbush noted that the failure of this deal may stem from heightened investor concern and ongoing antitrust issues surrounding Google, which has faced intense regulatory scrutiny in recent years and recently concluded a significant trial by the Department of Justice.
Ives pointed out that the collapse of the Wiz deal could have “ripple impacts” across the cybersecurity sector. Despite this setback, he anticipates that Google will continue to aggressively expand its cybersecurity initiatives, a path that Microsoft is also expected to follow.
Ives speculated that Microsoft may seek to consolidate and enhance its own cybersecurity offerings in the next 12 to 18 months. The company has recently faced scrutiny after a global IT outage linked to a faulty CrowdStrike update disrupted services for users worldwide. This incident has highlighted potential gaps in Microsoft’s cybersecurity measures, suggesting an urgent need for strengthening its position in this sector, particularly in the wake of Google’s failed bid for Wiz.