Wiz’s decision to reject Google’s $23 billion acquisition offer could have significant implications for the tech sector, particularly for Microsoft. The Israeli cybersecurity startup turned down the proposal to focus on achieving its goal of generating $1 billion in annual revenue and preparing for an initial public offering.
The acquisition would have strengthened Google’s cybersecurity efforts shortly after a major outage last week caused by CrowdStrike, a leading industry player. According to Wedbush analyst Dan Ives, concerns from investors and ongoing antitrust issues contributed to the deal’s collapse. Google is currently facing intense scrutiny and has just concluded a key antitrust trial initiated by the Department of Justice.
Ives noted that the failure of the Wiz deal is likely to create ripple effects throughout the cybersecurity market. He anticipates that Google will continue to expand its cybersecurity capabilities, as will its competitor Microsoft.
Ives emphasized that consolidation in the cybersecurity industry is necessary and expects Microsoft to pursue opportunities to enhance its cybersecurity offerings in the next 12 to 18 months. Microsoft faced negative attention following a widespread IT outage linked to a faulty update from CrowdStrike, which disrupted operations for businesses, flights, and government services globally.
Although Ives maintains that CrowdStrike remains a top player in cybersecurity, the incident underscores the need for Microsoft to strengthen its security platform, particularly in light of Google’s failed acquisition.