Alphabet, the parent company of Google, has reportedly resumed discussions to acquire cybersecurity startup Wiz for a sum close to $30bn. According to the Wall Street Journal, which first reported the story, the potential deal could mark the largest acquisition for Alphabet, eclipsing all its previous investments. The tech conglomerate started negotiations to buy Wiz for $23bn last year. However, the talks fell through in July 2024 when concerns arose among some of Wiz’s directors and investors about potential antitrust obstacles.
Current negotiations indicate that a deal between the two parties could be finalised shortly. However, the agreement is not yet confirmed, and terms remain subject to change. Neither Alphabet nor Wiz has issued any comments regarding the current acquisition talks.
The deal, if announced, will rank among the biggest deals of the year. The possible tie-up may still face scrutiny from the US Federal Trade Commission (FTC), although President Trump’s new administration is expected to drop some antitrust policies.
Wiz’s growth in the cybersecurity sector
Wiz was established in 2020 by former Israeli military officers. It is now based in the US and helps organisations create secure cloud environments by identifying and removing critical risks. The company’s growth has been fuelled by an increase in cloud adoption among businesses. According to the company website, the cybersecurity startup counts 50% of Fortune 100 as its customers.
Wiz reported reaching $500m in annualised recurring revenue last year and has set a target to double this by 2025. The company also expressed intentions to go public after negotiations with Alphabet ended last year.
In September 2024, it was reported that Wiz was exploring a sale of existing shares at a valuation between $15bn and $20bn. The company was valued at $12bn following a $1bn private fundraising round in July 2024.
Alphabet has been exploring ways to enhance its revenue from cloud computing services as a means to diversify its income streams beyond its traditional reliance on advertising revenue tied to its search engine business. The potential acquisition will bolster Alphabet’s position in the cybersecurity market and enhance its cloud infrastructure offerings. The tech giant’s Google Cloud’s current global market share is at about 12%, ranking third behind Amazon Web Services and Microsoft Azure.
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