Google’s parent company, Alphabet, is in negotiations to acquire cybersecurity start-up Wiz for approximately $30 billion, which would mark the largest acquisition in the company’s history, according to sources familiar with the matter. This new round of discussions comes after an initial attempt to purchase Wiz last year for $23 billion was abandoned due to concerns over antitrust issues raised by some of Wiz’s directors and investors.
The latest bid surpasses the previous offer by a significant margin, and while talks are ongoing, a deal could be finalised soon. If successful, the acquisition would rank among the largest transactions of the year and would likely face scrutiny from the Federal Trade Commission (FTC), especially under the leadership of Andrew Ferguson, who is maintaining guidelines that give the agency the authority to block large mergers.
Wiz, founded in 2020 by alumni of Israel’s elite cyber intelligence unit, is rapidly growing as a leading provider of cloud security services. The company has capitalised on the growing demand for cybersecurity solutions as businesses shift more operations to the cloud. Last year, Wiz hit $500 million in annualised recurring revenue and is targeting a revenue target of $1 billion by 2025. The company now serves nearly half of America’s top 100 largest firms, solidifying its position in the market.
The discussions come at a time of uncertainty in the deal-making environment, exacerbated by market volatility and trade policy concerns under the current administration. There are fears that large tech acquisitions may face additional challenges, with some critics arguing that Big Tech has gained too much power. Despite these challenges, Wiz’s rapid growth and strong position in cloud security have made it an attractive acquisition target for Alphabet, which has been seeking ways to strengthen its cloud computing division.
Wiz, which last raised $1 billion in 2022 at a $12 billion valuation, is backed by a number of prestigious investors, including Andreessen Horowitz, Lightspeed Venture Partners, Thrive Capital, and Sequoia Capital. The company had previously considered pursuing an initial public offering (IPO) after its earlier discussions with Alphabet fell through, but the latest talks suggest that a potential acquisition is back on the table.
If the deal goes through, it would surpass Alphabet’s previous largest acquisition—its $12.5 billion purchase of Motorola Mobility, which it has since sold. In 2022, Alphabet also spent $5.4 billion to acquire cybersecurity company Mandiant, further highlighting its focus on enhancing its Google Cloud services. Alphabet has been striving to grow its cloud business, which currently holds around 12% of the global market share, far behind Microsoft’s Azure and Amazon Web Services, which dominate the sector with shares of 21% and nearly 33%, respectively.
