Wiz’s decision to decline Google’s acquisition offer could have significant effects on Microsoft and the broader tech industry.
Google was attempting to purchase the Israeli cybersecurity firm Wiz for $23 billion, but the company announced on Tuesday that it had rejected the offer. Wiz’s CEO, Assaf Rappaport, explained that the choice to turn down the substantial bid was challenging, as the company aims to achieve $1 billion in annual revenue and pursue an initial public offering (IPO).
The acquisition would have enhanced Google’s cybersecurity capabilities, especially following a recent widespread outage linked to CrowdStrike, a major player in the industry. According to Wedbush analyst Dan Ives, investor apprehension and antitrust issues contributed to the deal’s collapse. Google has been under significant antitrust scrutiny in recent years and just concluded its trial regarding one of two key cases brought by the Department of Justice.
Ives noted that the failure of the deal could lead to ripple effects throughout the tech sector. He anticipates that Google will continue to focus on strengthening its cybersecurity initiatives despite the setback. He also suggested that Microsoft might seek opportunities to enhance its own cybersecurity platform in the next 12 to 18 months.
Microsoft recently faced criticism following a major global IT outage initiated by a flawed update from CrowdStrike. The incident disrupted businesses, flights, and government functions, highlighting potential vulnerabilities in Microsoft’s cybersecurity offerings. Ives maintains that while CrowdStrike remains a leader in the field, the outage demonstrates the need for Microsoft to fortify its cybersecurity capabilities, especially in light of Google’s failed acquisition.