Google’s parent company, Alphabet, never shies away from making headlines in the tech industry. Recently, they have once again entered advanced negotiations to acquire the cloud cybersecurity startup, Wiz. This isn’t their first attempt; last summer, a deal worth $23 billion was on the table but ultimately fell through. However, this time, talks are heating up with a reported price tag of approximately $30 billion according to sources from The Wall Street Journal.
Here are some key points around this potential acquisition:
- Thomas Kurian, head of Google’s cloud division, is spearheading the acquisition efforts.
- Google Cloud recognizes the synergy between its customer base and Wiz’s cloud security products. Wiz’s impressive annual recurring revenue (ARR) of $500 million, with projections to double by 2025, adds to its appeal.
- Although Wiz completed a $1 billion funding round at a $12 billion valuation last May, recent reports suggest their value surged to $16 billion after an internal tender offer.
- With the appointment of Fazal Merchant, a seasoned executive from DreamWorks and Tanium, as Chief Financial Officer, industry analysts speculate that Wiz might be gearing up for a potential public listing.
One of the sticking points in the previous negotiations was the integration plan for Wiz within Google Cloud. Would Wiz remain an independent entity or be assimilated into Google’s existing infrastructure? The decision on this front could potentially seal the deal this time around.
- Heightened regulatory scrutiny under the Biden administration was cited as a contributing factor to the failed negotiations last summer. The hope now lies in a more business-friendly environment under the new FTC Chair, Andrew Ferguson.
- The surge in M&A activity across various sectors indicates a renewed interest in deal-making, buoyed by expectations of a more lenient regulatory climate.
Wiz, based in New York and Israel, was founded in 2020 by four former Israeli military officers with a successful track record in the cybersecurity industry. Their impressive list of backers includes notable names like Andreessen Horowitz, Cyberstarts, and Index Ventures, among others.
The final outcome of the Alphabet-Wiz negotiations remains to be seen, but one thing is clear; the tech world is abuzz with anticipation over this potential blockbuster deal. Stay tuned for more updates.
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