Wiz’s decision to decline Google’s acquisition offer could significantly impact Microsoft and the tech industry as a whole.
Google had planned to acquire the Israeli cybersecurity startup Wiz for $23 billion, but this offer was rejected by Wiz on Tuesday. CEO Assaf Rappaport indicated that the decision, while difficult, was made to allow Wiz to pursue its goal of achieving $1 billion in annual revenue and preparing for an initial public offering (IPO).
This acquisition was seen as a way to strengthen Google’s cybersecurity division, especially after a recent massive outage attributed to CrowdStrike, a major player in the industry. Analyst Dan Ives from Wedbush highlighted that investor apprehensions and ongoing antitrust scrutiny likely contributed to the deal’s collapse. Google has faced significant legal challenges, recently concluding a trial related to antitrust issues.
Ives noted that the failure of the deal would have broader implications across the tech sector. He suggested that Google would likely continue focusing on expanding its cybersecurity efforts, a path that Microsoft may also pursue in the near future. Ives believes that consolidation within the cybersecurity industry is overdue, and opportunities for Microsoft to enhance its cybersecurity platform may arise over the next 12 to 18 months.
Microsoft faced scrutiny recently when a widespread IT outage linked to a problematic update in CrowdStrike’s software affected users globally, leading to disruptions in various sectors. While Ives maintains that CrowdStrike remains a leader in cybersecurity, the incident highlights the need for Microsoft to strengthen its cybersecurity offerings, further emphasized by the missed opportunity with Wiz.