Wiz’s decision to decline Google’s acquisition offer could have significant implications for Microsoft and the wider tech landscape.
Google was poised to acquire Israeli cybersecurity startup Wiz for $23 billion, but Wiz’s CEO, Assaf Rappaport, announced on Tuesday the difficult choice to reject the proposal. Rappaport emphasized the company’s goal to develop Wiz to generate $1 billion in revenue and pursue an initial public offering (IPO).
This acquisition would have enhanced Google’s cybersecurity capabilities, especially following a significant outage in the industry caused by CrowdStrike. Wedbush analyst Dan Ives noted that concerns from investors and ongoing antitrust issues contributed to the deal’s collapse. Google has faced increasing antitrust scrutiny in recent years and recently concluded a major trial linked to the Department of Justice.
Ives mentioned in a communication with investors that the failed deal would have “ripple impacts” across the tech sector. He anticipates that Google will continue to pursue expansion in its cybersecurity offerings, and he expects Microsoft to follow suit.
Ives indicated that consolidation in the cybersecurity sector is overdue, predicting that Microsoft might seek to strengthen its own cybersecurity platform within the next 12 to 18 months.
This comes after Microsoft faced adverse publicity due to a global IT outage linked to an update in its cybersecurity software provided by CrowdStrike. This disruption affected various industries, highlighting the need for Microsoft to enhance its cybersecurity strategies. Although Ives maintains that CrowdStrike remains a leader in the field, the incident suggests that Microsoft may need to bolster its cybersecurity capabilities following Google’s thwarted acquisition of Wiz.