Cybersecurity startup Wiz has rejected a $23 billion takeover offer from Google and its parent company Alphabet, making it the biggest takeover deal in the internet giant’s history. Wiz co-founder Assaf Rappaport said in a statement to company employees that Wiz preferred an IPO over a sale.
“It’s hard to say no to such modest offers,” Rappaport said in a statement. If the sale goes through, it would double Wiz’s valuation from the $12 billion it announced in May after the company raised $1 billion in private financing.
According to the statement sent to employees; Wiz will now focus on achieving $1 billion in annual recurring revenue, in addition to the IPO targets it set before its talks with Google. It is worth noting that there has been no official confirmation from either Wiz or Alphabet regarding the sale talks.
Why didn’t Wiz accept the offer made by Google?
Wiz offers cloud-based security solutions for enterprise customers, which could give Google a better chance of competing with industry leaders Microsoft and Amazon in this area. However, in recent years, major tech company acquisitions have come under much stricter scrutiny from regulators. Wiz reportedly turned down Google’s offer due to these concerns, as well as concerns from investors.
The US Department of Justice is currently conducting two investigations into Google over its search engine and digital advertising businesses. Google acquired two cybersecurity firms, Siemplify and Mandiant, for $500 million and $5.4 billion respectively in 2022. Adding a third company could put the internet giant in a difficult position.