Less than a year after initial talks collapsed, Alphabet has agreed to buy cloud security software company Wiz for $32 billion in the largest acquisition of a VC-backed company to date.
Alphabet initiated talks last year to buy Wiz, which is based in New York and Israel, but the company rejected its $23 billion bid. Wiz was eyeing an IPO once it had hit $1 billion in annual recurring revenue, something which it hoped to achieve in 2025.
There were concerns that regulators may not approve the original acquisition due to Biden’s antitrust crackdown. The new Trump administration pledged to unlock more dealmaking through deregulation for large transactions.
Despite these promises, M&A activity has slowed this year in the US, with only 2,486 deals worth a combined $302.5 billion closing this quarter so far, according to PitchBook data. In comparison, Q4 registered 3,620 transactions totaling $416.8 billion.
If the deal closes, it would be the largest M&A acquisition of the year and the Google parent’s biggest transaction by some distance. To date, its largest acquisition was the $12.5 billion takeover of Motorola Mobility in 2012, which was subsequently sold to Lenovo two years later.
Alphabet’s previous acquisitions in the cybersecurity space include a $5.4 billion deal for Mandiant in 2022 and $500 million for Siemplify.
The Wiz deal would also be the largest acquisition of a VC-backed company, PitchBook data shows. It’s currently backed by investors including Andreessen Horowitz, Sequoia and Index Ventures. The company most recently raised a $1 billion Series E in May at a $12 billion valuation.
According to a recent PitchBook analyst note, US VC-backed exit activity via acquisition rebounded sharply last year following two consecutive years of decline. A total 823 deals worth $88.3 billion closed in 2024, representing a 37% increase in toal value and a 4.4% rise in deal count.
Following the acquisition, Wiz would join Google Cloud to boost Alphabet’s competitiveness in the cloud infrastructure market. Currently, Google Cloud holds a 12% market share, trailing AWS and Microsoft Azure.
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