Wiz’s decision to back out of Google’s acquisition offer could significantly impact Microsoft and the broader tech industry. Google had aimed to acquire the Israeli cybersecurity firm for $23 billion, but Wiz’s CEO, Assaf Rappaport, rejected the proposal to focus on growing the company towards $1 billion in annual revenue and pursuing an initial public offering (IPO).
The acquisition would have enhanced Google’s cybersecurity capabilities, especially following a recent major outage linked to CrowdStrike, a key player in the industry. Analyst Dan Ives of Wedbush suggested that concerns from investors and ongoing antitrust issues were pivotal in the deal’s collapse. Google has faced increased antitrust scrutiny and recently concluded a trial related to such concerns.
Ives indicated that the failure of the deal is likely to create widespread implications across the cybersecurity sector. He anticipates that despite the setback with Wiz, Google will increase its efforts to strengthen its cybersecurity business, a sentiment he believes is shared by Microsoft.
Ives pointed out that consolidation in the cybersecurity industry is necessary and predicted that Microsoft might seek to enhance its cybersecurity offerings in the upcoming year. The need for this development was underscored by the recent global IT outage resulting from a problematic update to CrowdStrike’s cybersecurity software, which affected many Microsoft users and disrupted numerous businesses and government operations.
While Ives still regards CrowdStrike as the top standard in cybersecurity, the recent incident highlights potential vulnerabilities, indicating that Microsoft should intensify its focus on enhancing its cybersecurity measures, particularly in light of the failed acquisition.