Wiz’s decision to turn down Google’s acquisition offer could significantly impact the tech landscape, particularly for Microsoft.
The Israeli cybersecurity startup Wiz had been in discussions with Google for a potential buyout valued at $23 billion. However, on Tuesday, Wiz CEO Assaf Rappaport announced that the company would decline the offer. Rappaport indicated that this difficult choice was motivated by Wiz’s ambition to grow its annual revenue to $1 billion and eventually pursue an initial public offering.
The acquisition, if it had gone through, would have enhanced Google’s cybersecurity capabilities, especially in light of a recent significant outage affecting CrowdStrike, a major player in the industry. Following Wiz’s decision, Wedbush analyst Dan Ives noted in a research report that concerns from investors and ongoing antitrust issues contributed to the deal’s collapse. Google is currently facing heightened scrutiny from antitrust regulators and has just concluded a trial related to two significant cases from the Department of Justice.
Ives mentioned that the fallout from this deal not materializing may have broader implications across the tech sector. He anticipates that Google will continue to intensify its efforts in cybersecurity despite the loss of the Wiz opportunity. Similarly, he suggested that Microsoft might consider acquisitions to enhance its cybersecurity offerings over the next year or two.
Microsoft recently experienced backlash after a widespread IT outage linked to a faulty update from CrowdStrike, which provides cybersecurity solutions for its Windows operating system. Users around the globe reported encountering issues, significantly disrupting businesses and operations. Despite being recognized as a leading cybersecurity firm, the incident may signal a need for Microsoft to enhance its cybersecurity measures, and Wiz’s rejection of Google could create further opportunities for investment in this area.