Wiz’s decision to reject Google’s proposal could significantly impact the tech industry, particularly Microsoft.
Google had aimed to acquire the Israeli cybersecurity startup Wiz for $23 billion, but the company turned down the offer earlier this week. Wiz’s CEO, Assaf Rappaport, stated that he’s committed to steering Wiz towards generating $1 billion in annual revenue and eventually pursuing an IPO, making the rejection a difficult choice.
This deal would have strengthened Google’s cybersecurity sector, especially following a recent major outage caused by CrowdStrike, an industry leader. Analyst Dan Ives from Wedbush mentioned that concerns from investors and ongoing antitrust issues contributed to the failed acquisition. Google is currently under close scrutiny from regulators and has recently completed a trial related to one of two significant antitrust cases from the Department of Justice.
Ives emphasized that the failed deal would create ripples across the technology sector. He anticipates that Google will intensify its efforts to grow its cybersecurity capabilities, a sentiment shared by its competitor Microsoft.
Ives remarked that consolidation in the cybersecurity industry is overdue, suggesting Microsoft is likely to pursue strategies to enhance its cybersecurity offerings within the next 12 to 18 months. The company gained negative attention during the recent global IT outage caused by a faulty update to its cybersecurity software supplied by CrowdStrike. This incident, which resulted in widespread disruption for businesses and essential operations, highlights the need for Microsoft to strengthen its cybersecurity measures, especially in light of Google’s unsuccessful acquisition attempt.