Google’s parent company Alphabet is once again in advanced talks to acquire cloud cybersecurity startup Wiz, a person familiar with the deal shared. The two companies were close to securing a deal at a $23 billion valuation last summer, but the transaction failed to materialize.
This time, the price being discussed is higher, the person said. A price of around $30 billion was reported by The Wall Street Journal.
Thomas Kurian, head of Google’s cloud division, is once again leading the effort.
Google Cloud sees Wiz’s cloud security products as a good fit for its customer base, and Wiz’s annual recurring revenue (ARR) is attractive too. This stood at $500 million last July, with plans to hit $1 billion in ARR in 2025, TechCrunch reported at that time.
$30 billion would likely represent a significant premium price tag for the acquisition. Wiz closed its last outside funding round of $1 billion at a valuation of $12 billion last May and saw its valuation reportedly rise to $16 billion in an employee tender offer late last year.
Although Wiz previously stated no plans for a public offering in 2025, it appointed Fazal Merchant, a former executive at DreamWorks and Tanium, as Chief Financial Officer. The hiring of a CFO can sometimes signal preparations for a public offering.
One sticking point in previous discussions was the disagreement between the two companies on whether Wiz would remain a separate division or be integrated into Google Cloud, as reported by The Wall Street Journal.
The person familiar with the deal mentioned that the breakdown of the previous talks last summer was also influenced by heightened regulatory scrutiny for large transactions during the Biden administration.
Other investors have noted an uptick in M&A activity, with hopes of a more lenient approach to large transactions under FTC Chair Andrew Ferguson compared to former Chair Lina Khan.
Wiz, headquartered in New York and Israel, was established in 2020 by four former Israeli military officers who previously founded a cloud cybersecurity company called Adallom, later acquired by Microsoft for $320 million.
Wiz’s investors include Andreessen Horowitz, Cyberstarts, Index Ventures, Greenoaks, Insight Partners, and Sequoia.
A spokesperson for Wiz chose not to comment on the ongoing deal discussions.
