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Google is in advanced talks to acquire Wiz, a person familiar with the matter told CNN.
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CNN
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Google parent company Alphabet is in talks to buy fast-growing cybersecurity startup Wizz for about $23 billion, a person familiar with the matter confirmed to CNN.
The acquisition of Wizz, a company that makes cybersecurity software for cloud computing, marks a big bet by Google on cybersecurity and its largest acquisition to date.
The talks between Google and Wizz began after the company raised $1 billion from venture capital investors earlier this year, the sources said.
The terms of a potential deal have yet to be finalized and talks could fall apart, the sources said.
News of the Google-Wiz negotiations was first reported by The Wall Street Journal.
Neither Google nor Wiz responded to CNN’s requests for comment.
The deal would easily surpass Google’s largest acquisition ever, when it bought Motorola for $12.5 billion nearly a decade ago, after selling the company just two years later at a huge loss.
Wiz’s $23 billion price tag is nearly double the startup’s $12 billion valuation in its most recent funding round.
In March 2022, Alphabet acquired cybersecurity company Mandiant for $5.4 billion as part of an effort to help companies better address cyber threats and bolster its cloud computing business.
Google Cloud has been at the center of the company’s efforts to diversify revenue beyond its core search advertising business, as the company’s cloud revenue grows but it struggles to compete with similar services from Microsoft and Amazon.
The Wizz acquisition would send a “warning” to Microsoft and Amazon and signal that Google is “betting big on cybersecurity to complement its core cloud services,” Dan Ives, managing director and senior equity research analyst at Wedbush, wrote in a client note on Monday.
Cloud security has become especially important in recent years as companies spend billions of yen to move their data to cloud platforms. Last week, AT&T revealed that a massive breach caused by “illegal downloads” on a third-party cloud platform exposed nearly all of its wireless customers’ call and text records.
Google and Wiz’s deal talks come despite the Biden administration’s increased antitrust scrutiny of the tech giants.
But if Trump were to return to the White House, antitrust oversight could be somewhat relaxed, the Federal Trade Commission would be “much weaker” and it would create “an environment of accelerated mergers and acquisitions for big tech companies,” Ives said.
If the acquisition goes through, it will mark a major departure for Wiz and its founders, Assaf Rapaport, Ami Luttwak, Ynon Kostika and Roy Resnick, who met several years ago when the four executives were drafted into Unit 8200, the Israel Defense Forces’ cyber intelligence unit.
New York City-based Wiz has seen explosive growth since it was founded in March 2020 at the height of the COVID-19 pandemic, and the company says it now counts 40% of Fortune 100 companies as clients.
Notable clients include BMW, Slack and Salesforce, and the company works with major cloud companies such as Amazon, Microsoft and Google.
