Google eyes its biggest acquisition yet, Alphabet may buy cybersecurity startup Wiz for $23bn

Alphabet, the parent company of Google, is reportedly nearing a landmark acquisition of cybersecurity startup Wiz for around $23 billion. If completed, this deal would be Alphabet’s largest purchase to date. The majority of the payment is expected to be made in cash, with the finalization of the deal anticipated soon, according to Reuters.

Wiz, originally founded in Israel and now headquartered in New York, has rapidly grown into a prominent provider of cloud-based cybersecurity services. These services leverage artificial intelligence to identify and respond to threats in real-time. In 2023, Wiz achieved approximately $350 million in revenue and partnered with 40 per cent of Fortune 100 companies.

This potential acquisition is particularly significant given the increased scrutiny by the U.S. government under President Joe Biden’s administration, which aims to prevent large tech companies from further expanding their dominance through acquisitions. Despite this regulatory climate, Alphabet appears to be proceeding with its plans.

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Wiz collaborates with several major cloud providers, including Microsoft and Amazon, and boasts a diverse customer base ranging from Morgan Stanley to DocuSign. With a workforce of 900 employees spread across the United States, Europe, Asia, and Israel, Wiz had previously announced intentions to expand by adding 400 employees globally in 2024.

Should Alphabet proceed with the acquisition, it would be a notable instance of a major tech company pursuing a significant merger amidst heightened regulatory oversight. U.S. regulators have increasingly shown resistance to large tech companies growing through acquisitions in recent years.

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The proposed deal would surpass Alphabet’s previous largest acquisition, the $12.5 billion purchase of Motorola Mobility in 2012. However, Alphabet later sold Motorola Mobility for $2.91 billion. At the time of the Motorola acquisition, the company was seen as a key competitor to Samsung in the Android smartphone market.

Alphabet had also recently considered acquiring the online marketing software company HubSpot but ultimately decided against it. The focus now seems to be on enhancing its cybersecurity capabilities through the potential acquisition of Wiz.

As of now, neither Alphabet nor Wiz has commented on the potential deal. The tech industry is closely monitoring the situation, as this major acquisition could have significant implications for both cybersecurity and Alphabet’s overall business strategy.