Wiz has ended talks with Google parent Alphabet on a proposed $23 billion deal in which the Israeli cybersecurity startup would have become the US tech giant’s largest-ever acquisition, according to a Wiz memo seen by CNN.
Wiz CEO Assaf Rappaport said the company would now focus on an initial public offering and growing the business to generate $1 billion in annual revenue.
“I know the last week has been intense, with the buzz about a potential acquisition. While we are flattered by offers we have received, we have chosen to continue on our path to building Wiz,” Rappaport said in the memo.
“Saying no to such humbling offers is tough, but with our exceptional team, I feel confident in making that choice.”
Neither Alphabet (GOOGL) nor Wiz had officially acknowledged talks about a deal, and the Wiz memo did not mention Google or its parent by name.
A person familiar with the matter told CNN on Tuesday that Wiz management, after seriously considering the Google offer, decided to walk away because they want to remain an independent company and are confident Wiz can be built into one of the biggest cybersecurity firms on the planet.
Risks around a potentially lengthy and challenging antitrust review were in the background but were not a deciding factor here, the source told CNN.
CNN reported earlier this month that Alphabet was in advanced talks to buy Wiz for roughly $23 billion, citing a person familiar with the matter.
Discussions between Google and Wiz began after the startup raised $1 billion from venture capital investors earlier this year, the source said. That funding round had valued Wiz at $12 billion.
Wiz provides cloud-based cybersecurity solutions that help companies identify and remove critical risks on cloud platforms.
Wiz’s decision to call off the deal will be a setback for Google, which has been investing in its cloud infrastructure and focusing on winning clients for the cloud business that generated more than $33 billion in revenue last year.
It is the second recent blow for Alphabet in its M&A efforts, after it reportedly decided to walk away from a deal for online marketing software company HubSpot.
In March 2022, Alphabet bought cybersecurity firm Mandiant for $5.4 billion as part of its push to help companies better address cyber threats and bolster its cloud computing business.
Reuters contributed to this article.
