Israeli cybersecurity Wiz cancels $23b acquisition by Google

Israeli cybersecurity startup Wiz has terminated negotiations with Alphabet, Google’s parent company, on a potential $23 billion acquisition deal, according to a company memo. The deal would have marked Alphabet’s largest acquisition to date.

Wiz CEO Assaf Rappaport announced the decision in a memo, stating that the company will now proceed with its planned initial public offering (IPO) and aims to achieve an annual recurring revenue of $1 billion.

“Saying no to such humbling offers is tough, but with our exceptional team, I feel confident in making that choice,” Rappaport said in the memo, referring to an acquisition offer.

Alphabet and Wiz have not confirmed any deal discussions. The memo from Wiz did not mention Google or Alphabet. Google did not respond to a request for comment, and Wiz chose not to comment.

According to Reuters, Alphabet is in advanced discussions to acquire Wiz for around $23 billion, which is almost double the valuation announced in May when Wiz secured $1 billion in a private funding round at a $12 billion valuation.

Wiz’s decision to cancel the deal is a setback for Google, which has been investing in its cloud infrastructure to grow its cloud business that generated over $33 billion in revenue last year.

This is another setback for Alphabet in the M&A sector following reports of its withdrawal from a deal with online marketing software company HubSpot.

Wiz would have become Alphabet’s second major acquisition in the cybersecurity sector, following the $5.4 billion purchase of Mandiant in 2022.

Attribution: Reuters