Alphabet, Google’s parent company, plans to make one of its largest acquisitions in history. The company made its last major acquisition almost a decade ago, acquiring Motorola Mobility for $12.5 billion. According to WSJ (Wall Street Journal), the discussion regarding the acquisition of $23 billion of Wiz might fall through if all the pending details are not ironed out. However, this is not the only thing that might block the deal by the regulators. According to experts, a potential antitrust lawsuit resulting from Alphabet’s acquisition of Wiz is a major concern.
Under the Biden administration, the government has taken a firm stance against consolidating tech giants and corporations. This stance has already led to the blocking of multiple deals, such as the publishing giant Penguin Random House’s $2.18 billion acquisition of rival Simon & Schuster and JetBlue’s $3.8 billion acquisition of Spirit Airlines. This regulatory environment could significantly impact Alphabet’s potential acquisition of Wiz.
Meet Wiz, A $23 Billion US Based Israeli Startup
Founded in 2020 by Israeli entrepreneur and former Microsoft executive Assaf Rappaport, Wiz has quickly established itself as a significant player in the cybersecurity industry. Backed by prominent venture capital firms, such as Sequoia and Thrive, the company was recently valued at $12 billion. Wiz specialises in helping clients, including Morgan Stanley, safeguard their cloud programs, which have become increasingly crucial as these companies store more data online and face constant threats of cyber attacks. Through its services, Wiz generates an impressive annual recurring revenue of $350 million.
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What Next?
Wiz declined to comment on the negotiations, and Google did not respond to a request for comment. These discussions between Alphabet and Wiz follow Google’s recent decision not to pursue the acquisition of the online marketing software company HubSpot, as reported by Reuters earlier this month.
