Wiz’s decision to decline Google’s acquisition offer has significant ramifications for the technology sector, particularly for Microsoft. The Israeli cybersecurity startup was in talks with Google for a $23 billion deal, but CEO Assaf Rappaport announced the rejection, stating that the choice was challenging but necessary for Wiz to focus on achieving $1 billion in annual revenue and preparing for an initial public offering.
This acquisition would have strengthened Google’s cybersecurity division amid recent upheaval in the industry, including a major outage stemming from a CrowdStrike software update that disrupted operations worldwide. According to Wedbush analyst Dan Ives, concerns from investors and ongoing antitrust issues contributed to the collapse of the deal. Google’s antitrust challenges have been heightened, as evidenced by its recent trial related to two significant cases initiated by the Department of Justice.
Ives noted that the failed acquisition would likely have widespread effects across the tech industry. Despite the setback, he suggested that Google would pursue further expansion in cybersecurity. Similarly, he predicted that Microsoft might look to enhance its cybersecurity platform in the next 12 to 18 months, especially after facing scrutiny during the CrowdStrike outage that impacted businesses, transportation, and government services globally.
Although Ives referred to CrowdStrike as the “gold standard” of cybersecurity, the incident highlighted the need for Microsoft to reinforce its cybersecurity capabilities, further emphasizing that the abandonment of the Wiz deal could facilitate this strategic move.