Google to acquire cybersecurity firm Wiz for $32 Billion in record deal

Google has announced a landmark deal to acquire rapidly growing cybersecurity company Wiz for $32 billion, marking its largest-ever acquisition. The all-cash deal underscores Google’s strong commitment to bolstering its cloud security capabilities amid the rapid growth of artificial intelligence (AI) and the increasing importance of cybersecurity in the tech industry.

The acquisition of Wiz, a New York-based company that specializes in cloud security software, is poised to surpass Google’s previous record acquisition — its ill-fated $12.5 billion purchase of Motorola Mobility in 2012. Google later sold Motorola at a significant loss. The Wiz deal, subject to regulatory approval, positions Google to further expand its cloud business, a key area of growth for the company.

Wiz was founded just five years ago by Assaf Rappaport, Ami Luttwak, Yinon Costica, and Roy Reznik, all of whom previously served in Unit 8200, the cyber intelligence division of the Israel Defense Forces. The company has grown rapidly since its inception, providing cloud security solutions for businesses navigating increasingly complex cybersecurity threats. Rappaport highlighted the fast-moving nature of the cybersecurity industry, stating, “Wiz has achieved so much in a relatively short period, but cybersecurity moves at warp speed and so must we. The time is now.”

Initially, Wiz had been in talks with Google last summer regarding a potential $23 billion sale, but those discussions stalled before the companies returned to the negotiating table. At $32 billion, the acquisition ranks as the seventh-largest takeover of a private U.S. firm, according to Dealogic.

The deal also comes at a time when mergers and acquisitions (M&A) activity in the tech sector has slowed due to economic uncertainties and waning CEO confidence. However, some Wall Street analysts are optimistic that the Google-Wiz transaction could signal a resurgence in dealmaking, particularly after the departure of Lina Khan, former chair of the Federal Trade Commission (FTC). Khan had been known for her tough stance on antitrust regulations, which had previously slowed large mergers.

The revival of high-profile acquisitions like Google’s deal for Wiz indicates that, with a more favorable regulatory environment, Big Tech may once again be primed for significant consolidation. However, it is yet to be seen how Google does on the AI front as it lags behind in the race from OpenAI and others.