Cybersecurity firm Wiz has opted to forgo a record-breaking $23 billion acquisition by Google’s parent company, Alphabet, choosing instead to pursue an initial public offering (IPO).
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In an internal memo obtained by CNBC, Wiz co-founder Assaf Rappaport acknowledged the difficulty of rejecting such a substantial offer. The acquisition would have significantly inflated Wiz’s valuation, doubling its worth from $12 billion after a $1 billion funding round in May.
The memo reveals that Wiz will maintain its pre-Google discussions focus: achieving $1 billion in annual recurring revenue and completing an IPO. Notably, neither Wiz nor Alphabet have officially commented on the acquisition talks.
Wiz’s cloud-based security solutions make it a valuable asset in the ongoing battle against cyber threats. Its acquisition by Google would have significantly bolstered the search giant’s position against rivals Microsoft and Amazon in the cloud security space. However, the memo suggests that concerns over antitrust regulations, a growing issue for Big Tech companies, influenced Wiz’s decision. This is further supported by the Department of Justice’s ongoing lawsuits against Google regarding its search engine and advertising practices.
While the record-breaking deal might not be happening, Google continues to invest in cybersecurity. The company acquired two cybersecurity firms in 2022 – Siemplify and Mandiant (known for uncovering the SolarWinds hack) – for $500 million and $5.4 billion respectively.
