Google has announced it is acquiring cybersecurity startup Wiz for $32 billion. The acquisition is parent company Alphabet’s largest to date, more than doubling its previous record-breaking $12.5 billion purchase of Motorola Mobility in 2012. The company appears to have pursued this deal aggressively due to the growing demand for secure cloud services.
The surge in generative AI has prompted tech companies to rush for cloud infrastructure, while major security incidents, such as last year’s CrowdStrike outage, have heightened concerns. Wiz’s software incorporates AI-powered security features that identify critical risks in cloud infrastructure, allowing developers to remediate them before they become an issue.
If Wiz’s products are integrated, Google Cloud could gain a significant advantage in a market where it has historically fallen behind Amazon Web Services and Microsoft Azure. In Google’s announcement about the acquisition, it said Wiz will provide its customers with improved and lower-cost security for multiple cloud and code environments.
Despite the acquisition, Wiz’s products will continue to work and be available across all major clouds, including Amazon Web Services, Microsoft Azure, and Oracle Cloud platforms.
In a press release about this acquisition news, Google Cloud CEO Thomas Kurian stated: “Google Cloud and Wiz share a joint vision to make cybersecurity more accessible and simpler to use for organizations of any size and industry.” And, Alphabet and Google CEO Sundar Pichai noted: “Together, Google Cloud and Wiz will turbocharge improved cloud security and the ability to use multiple clouds.”
SEE: CrowdStrike vs Wiz: Which Offers Better Cloud Security and Value?
Wiz’s rejection of Alphabet’s previous offer
When Wiz declined Alphabet’s last offer of $23 billion in July 2024, the startup cited concerns over antitrust scrutiny and disagreements on whether it would operate as an independent division or be fully integrated into Google Cloud, The Wall Street Journal reported at the time.
After the deal collapsed, Wiz CEO Assaf Rappaport told employees the company would pursue an initial public offering, believing it could achieve a higher valuation as a publicly traded entity (the company was valued at $12 billion by investors in May 2024). Nevertheless, Rappaport clearly re-engaged with potential buyers since.
Regulatory challenges and Alphabet’s antitrust battles
Google said the deal is subject to customary closing conditions including regulatory approvals. Alphabet’s previous bid faced obstacles due to antitrust regulations imposed by the Biden administration such as the Executive Order on Competition, which mandates strict scrutiny of mergers, particularly in the tech sector.
Although there was speculation that U.S. President Donald Trump might roll back certain regulations to favor innovation, his administration has instead introduced tariffs that could increase costs for tech companies. This shift in policy has made investors cautious about major acquisitions.
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Meanwhile, Google is currently facing two major antitrust lawsuits in the States. Last year, the Department of Justice demanded Google divest its Chrome browser, arguing it has been leveraging the platform to funnel users to its search engine, maintaining dominance in online search. The company is now awaiting a remedies trial.
A verdict is also pending on whether Google illegally monopolised the digital advertising market through its ad technology business, which has also received legal scrutiny in the U.K. and EU. In August 2024, a U.S. federal judge also ruled that Google holds a monopoly on general search services and text ads and has broken antitrust laws.
For more specifics about the acquisition, Alphabet’s webcast about the news will be available to watch for the next two weeks. Sundar Pichai, Thomas Kurian, Wiz CEO Assaf Rappaport, and Alphabet and Google CFO Anat Ashkenazi discuss the transaction.