Wiz’s decision to reject Google’s acquisition offer could have significant consequences for the tech industry, particularly for Microsoft. The Israeli cybersecurity startup was approached by Google with a $23 billion deal, which was turned down by Wiz’s CEO Assaf Rappaport. He stated that the difficult choice was made to focus on achieving $1 billion in annual revenue and preparing for an IPO.
The failed acquisition would have strengthened Google’s cybersecurity capabilities, especially following a major outage impacting the cybersecurity sector caused by CrowdStrike last week. Wedbush analyst Dan Ives noted that the breakdown of the deal was influenced by investor concerns and ongoing antitrust scrutiny facing Google, which recently concluded its trial linked to two significant cases by the Department of Justice.
Ives indicated in an email to investors that the fallout from this unsuccessful deal could create widespread implications in the cybersecurity market. He believes Google will likely continue to enhance its cybersecurity efforts despite the setback with Wiz, a move Microsoft may also take as it looks to bolster its cybersecurity platform in the next year and a half.
The situation gained further attention after a significant global IT outage occurred due to a faulty update from CrowdStrike, the software provider used by Microsoft. This incident resulted in disrupted services across various sectors and highlighted the necessity for Microsoft to strengthen its cybersecurity approach. Despite Ives labeling CrowdStrike a leader in cybersecurity, the recent outage underlines the urgency for Microsoft to expand its security capabilities, particularly in light of Google’s abandoned acquisition.