Google's parent company, Alphabet, is reportedly in advanced negotiations to purchase cybersecurity firm Wiz for approximately $23 billion, according to a source close to the situation who spoke on Sunday. This acquisition would mark the largest in Alphabet's history. The transaction, primarily financed through cash, is expected to finalize soon, the anonymous source added. Wiz, established in Israel and currently based in New York, is recognized as one of the world's fastest-expanding software startups, offering cloud-based cybersecurity services with real-time threat detection and responses powered by artificial intelligence.
Should Alphabet proceed with this acquisition, it would stand out as a significant technology company undertaking a large-scale deal amidst increased regulatory scrutiny under President Joe Biden's administration. In recent times, U.S. regulators have shown a growing reluctance towards large technology companies expanding through acquisitions. Wiz reported revenue of around $350 million in 2023 and collaborates with 40% of Fortune 100 companies, as stated on its website. The company recently secured $1 billion in a private funding round, valuing it at $12 billion.
Alphabet and Wiz have yet to respond to requests for comment. Wiz partners with various cloud service providers including Microsoft and Amazon, and serves a diverse clientele ranging from Morgan Stanley to DocuSign. With a workforce of 900 spread across the United States, Europe, Asia, and Israel, Wiz previously announced plans to hire an additional 400 employees globally in 2024. Alphabet recently opted not to pursue the acquisition of online marketing software company HubSpot.
Deal activity within the technology sector has increased this year. In January, design software firm Synopsys agreed to acquire its smaller competitor Ansys for about $35 billion. Similarly, Hewlett Packard Enterprise finalized a deal in January to acquire networking equipment manufacturer Juniper Networks for $14 billion. Technology has dominated mergers and acquisitions in the first half of the year, with a 42% year-on-year increase to $327.2 billion, according to Dealogic data. The Wall Street Journal initially reported on Alphabet's discussions with Wiz earlier on Sunday.
