Wiz’s decision to decline Google’s acquisition offer could significantly affect Microsoft and the broader tech landscape.
Google was looking to acquire the Israeli cybersecurity firm Wiz for $23 billion, but Wiz CEO Assaf Rappaport announced on Tuesday that the company would not proceed with the deal. Rappaport explained that turning down the substantial offer was a challenging choice, aimed at allowing Wiz to focus on its goal of reaching $1 billion in annual revenue and preparing for an initial public offering.
This acquisition would have enhanced Google’s cybersecurity capabilities, especially in light of a recent major outage linked to CrowdStrike, a leading cybersecurity company. Analyst Dan Ives from Wedbush noted that the collapse of the deal stemmed from investor worries and ongoing antitrust issues surrounding Google, which has faced intense scrutiny and recently concluded a trial regarding its market practices.
Ives suggested that the failure of this deal could send ripples throughout the tech sector. He indicated that Google will likely continue to strengthen its cybersecurity efforts despite the loss of the Wiz acquisition. Similarly, Microsoft is expected to seek ways to enhance its own cybersecurity offerings in the coming one to one and a half years.
The urgency for Microsoft to reinforce its cybersecurity measures came to light following a global IT outage triggered by a flawed update in CrowdStrike’s software. This incident impacted various sectors, causing widespread disruptions. Despite Ives depicting CrowdStrike as the “gold standard” of cybersecurity, the outage highlighted the necessity for Microsoft to improve its cybersecurity infrastructure, with the aborted Wiz deal further emphasizing this need.