Wiz’s decision to reject Google’s acquisition offer could significantly impact the technology sector, particularly Microsoft.
Google intended to acquire the Israeli cybersecurity startup Wiz for $23 billion, but the offer was turned down by Wiz’s CEO, Assaf Rappaport. He described the choice as “tough,” indicating that the company aims to continue its growth towards achieving $1 billion in annual revenue and pursuing an initial public offering (IPO).
The acquisition would have strengthened Google’s presence in the cybersecurity field, especially following a major outage linked to CrowdStrike that affected the industry last week. According to Wedbush analyst Dan Ives, concerns from investors and ongoing antitrust issues contributed to the deal’s collapse. Google has faced intense antitrust scrutiny and recently concluded one of its high-profile trials with the Department of Justice.
Ives mentioned in a note to investors that the fallout from the halted deal could lead to significant repercussions across the tech sector. He suggested that Google would likely continue to pursue an expanded role in cybersecurity despite the setback. Similarly, Microsoft is expected to enhance its own cybersecurity platform in the coming year to 18 months, as consolidation in the sector seems necessary.
This comes after Microsoft found itself under scrutiny due to a global IT outage caused by a flawed update from CrowdStrike, its cybersecurity partner. Microsoft users experienced significant disruptions, known colloquially as the “blue screens of death,” affecting various sectors including business, air travel, and government services.
While Ives still regards CrowdStrike as a premier figure in cybersecurity, the recent incident highlights the need for Microsoft to strengthen its own cybersecurity measures, with the collapse of the Google-Wiz deal potentially broadening that opportunity.