Alphabet, Google's parent company, is in advanced discussions to buy the cybersecurity startup Wiz for about $23 billion. This deal would be Alphabet's largest acquisition to date. According to a source who requested anonymity, the purchase is mostly being funded in cash and could be finalized soon.
Wiz, founded in Israel and now based in New York, is a rapidly growing company that provides cloud-based cybersecurity solutions. Their technology uses artificial intelligence to detect and respond to threats in real-time.
If the deal goes through, it would be notable because it happens during a period of increased regulatory scrutiny of major tech companies under President Joe Biden's administration. Recently, U.S. regulators have shown a reluctance to allow big tech firms to grow through acquisitions.
In 2023, Wiz generated approximately $350 million in revenue and works with 40% of Fortune 100 companies. The company also recently raised $1 billion in a private funding round, valuing it at $12 billion. Neither Alphabet nor Wiz has responded to requests for comment.
Wiz partners with several major cloud providers, including Microsoft and Amazon, and counts companies like Morgan Stanley and DocuSign among its customers. The company has 900 employees across the U.S., Europe, Asia, and Israel and plans to add 400 more workers globally in 2024.
Recently, Alphabet decided not to pursue the acquisition of the online marketing software company HubSpot. However, deal-making in the tech sector has been on the rise this year. For example, design software company Synopsys agreed to buy Ansys for about $35 billion, and Hewlett Packard Enterprise struck a deal to buy Juniper Networks for $14 billion. Technology deals accounted for the largest share of mergers and acquisitions in the first half of the year, increasing by more than 42% to $327.2 billion, according to Dealogic.
Key Points
Big Acquisition: Alphabet, Google's parent company, is in advanced talks to buy the cybersecurity startup Wiz for around $23 billion, making it their largest purchase ever.
Wiz's Success: Wiz, a rapidly growing company providing AI-powered cloud cybersecurity solutions, made $350 million in revenue in 2023 and works with 40% of Fortune 100 companies.
Regulatory Context: The deal is significant as it comes amid increased regulatory scrutiny of large tech companies by U.S. authorities under President Joe Biden's administration.
FAQs
Q1: Why is Alphabet, the parent company of Google, interested in acquiring Wiz?
Alphabet, the parent company of Google, is interested in acquiring Wiz to enhance its cybersecurity capabilities with Wiz's advanced AI-powered cloud solutions, which could significantly strengthen its tech portfolio.
Q2: How does this acquisition impact Alphabet as the parent company?
This acquisition, if completed, would be Alphabet's largest ever, highlighting its commitment to expanding its cybersecurity offerings and potentially increasing its influence in the tech sector.
Q3: What makes Wiz attractive to Alphabet, the parent company of Google?
Wiz is attractive to Alphabet, the parent company of Google, due to its rapid growth, impressive revenue, and partnerships with major Fortune 100 companies, providing valuable cloud-based cybersecurity solutions.
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