Wiz’s decision to decline Google’s acquisition offer could significantly affect the tech landscape, particularly for Microsoft.
Google had aimed to acquire the Israeli cybersecurity firm Wiz for $23 billion, but on Tuesday, Wiz’s CEO Assaf Rappaport announced the challenging choice to reject the offer, with plans to grow Wiz towards achieving $1 billion in annual revenue and ultimately pursuing an IPO.
This acquisition would have enhanced Google’s cybersecurity capabilities, especially following a recent major outage attributed to CrowdStrike, impacting the cybersecurity community. Wedbush analyst Dan Ives noted that investor apprehensions and antitrust issues contributed to the deal’s collapse. Google has faced intensifying antitrust scrutiny recently, culminating in its ongoing trial regarding significant cases initiated by the Department of Justice.
Ives mentioned that the failure of this deal would likely have sector-wide repercussions. Despite the setback with Wiz, he believes Google will continue to focus on expanding its cybersecurity initiatives, a sentiment shared by Microsoft.
He added that consolidation in the cybersecurity market is overdue, predicting that Microsoft may pursue acquisitions to enhance its cybersecurity platform in the next 12 to 18 months.
Microsoft recently faced scrutiny following a global IT outage linked to a problematic update in its cybersecurity software provided by CrowdStrike. This incident, which led to significant disruptions across various sectors, highlights the growing need for Microsoft to strengthen its cybersecurity measures. The collapse of the Wiz acquisition potentially opens more avenues for Microsoft to expand its cybersecurity offerings.