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Google is in advanced negotiations to buy Wiz, a person familiar with the matter told CNN.
New York
CNN
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Google owner Alphabet is in advanced talks to buy fast-growing cybersecurity startup Wiz for about $23 billion, a person familiar with the matter confirmed to CNN.
An acquisition of Wiz, a company that makes cybersecurity software for cloud computing, would be a major step for Google in the cybersecurity space, and would be the tech giant’s largest acquisition ever.
Talks between Google and Wiz began after the startup raised $1 billion from venture capitalists earlier this year, the source said.
According to the source, the terms of a possible deal have not yet been finalized and the talks could still fail.
News of the talks between Google and Wiz was first reported by The Wall Street Journal.
Neither Google nor Wiz responded to CNN’s request for comment.
The deal would easily surpass Google’s $12.5 billion acquisition of Motorola a decade ago, the largest acquisition in the company’s history. Google sold Motorola just two years later for a huge loss.
Wiz’s price tag is $23 billion, nearly double the $12 billion the startup was valued at in its most recent funding round.
In March 2022, Alphabet acquired cybersecurity company Mandiant for $5.4 billion as part of efforts to help companies better address cyber threats and strengthen their cloud computing businesses.
Google Cloud is central to the company’s efforts to diversify revenue beyond its core search advertising business. While cloud sales have grown, it has struggled to compete with similar services from Microsoft and Amazon.
The Wiz purchase would be a “shot across the bow” for Microsoft and Amazon, demonstrating that Google is making a “big bet on cybersecurity to complement its core cloud offerings,” Dan Ives, managing director and senior equity research analyst at Wedbush, wrote in a note to clients Monday.
Cloud security has become especially important in recent years as companies have spent large sums of money to move data to cloud platforms. Just last week, AT&T announced that nearly all of its wireless customers’ call and text message records had been exposed in a massive breach caused by an “illegal download” on a third-party cloud platform.
Negotiations over the Google-Wiz deal are taking place despite intense anti-monopoly scrutiny of tech giants under the Biden administration.
But that anti-monopoly oversight could be rolled back somewhat if Trump regains control of the White House, Ives said, leaving the Federal Trade Commission “much weaker” and creating “an accelerated merger and acquisition environment for Big Tech.”
If the acquisition is completed and closed, it would be a huge exit for Wiz and its founders — Assaf Rappaport, Ami Luttwak, Yinon Costica and Roy Reznik. The four executives met years ago when they were drafted into Unit 8200, the cyberintelligence division of the Israel Defense Forces.
Since launching in March 2020 during the Covid-19 pandemic, New York City-based Wiz has seen explosive growth. Today, the company says 40% of Fortune 100 companies are its customers.
Notable customers include BMW, Slack and Salesforce, and it works with major cloud companies including Amazon, Microsoft and Google.