Wiz’s decision to turn down Google’s acquisition offer could significantly impact the tech landscape, particularly for Microsoft.
Google had proposed to acquire the Israeli cybersecurity firm Wiz for $23 billion, but the offer was rejected. Wiz’s CEO, Assaf Rappaport, stated that the difficult choice was made in pursuit of building the company towards an annual revenue of $1 billion and preparing for an initial public offering (IPO).
This acquisition would have enhanced Google’s cybersecurity division, especially following a recent major outage from CrowdStrike, a prominent player in the industry. Wedbush analyst Dan Ives mentioned that concerns from investors and antitrust issues contributed to the deal’s failure. Google has faced considerable antitrust scrutiny and recently concluded a trial related to one of two significant cases brought by the Department of Justice.
Ives indicated that the collapse of the Wiz acquisition would have “ripple impacts” across the tech sector. He predicted that Google would continue to invest in expanding its cybersecurity capabilities following the breakdown of the deal, and the same could apply to rival Microsoft.
He noted a growing need for consolidation in the cybersecurity industry and suggested that Microsoft might pursue similar strategies to enhance its own cybersecurity platform in the next year to 18 months. The recent global IT outage, triggered by a flawed update to CrowdStrike’s software—which Microsoft utilizes for its Windows operating system—highlighted the vulnerabilities in Microsoft’s cybersecurity measures. This incident caused major disruptions worldwide, prompting conversations about the necessity for Microsoft to strengthen its cybersecurity efforts, especially in light of Google’s failed acquisition.