Wiz Prefers Google Acquisition Over IPO

In a surprising turn of events, the plans for cybersecurity start-up Wiz to be acquired have fallen through. Initially, it appeared that the technology giant Google intended to acquire Wiz for a record sum of $23 billion, which would have been Google's largest acquisition ever. However, on Monday evening, Wiz informed its employees that the company decided to remain independent and instead pursue a stock market listing, despite the generous offer. This was revealed in a memo obtained by the New York Times. Assaf Rappaport, the CEO of Wiz, emphasized in the memo that the company would continue to pursue its goal of generating an annual revenue of $1 billion before going public. "Although we feel flattered by the offers, we have decided to continue on our own path," Rappaport wrote. "It is difficult to reject such impressive offers, but with our extraordinary team, I feel confident in this decision." Google was not immediately available for comment, and a representative of Wiz also declined to comment. CNBC and Fortune reported on the memo's contents on Monday. A successful acquisition would have significantly boosted Google's cloud computing division and helped the company keep pace with its long-time rival Microsoft in the cybersecurity arena. More and more companies rely on Wiz to protect their cloud applications. Google's highest acquisition to date was the purchase of Motorola Mobility for $12.5 billion in 2012, a deal that later proved to be unprofitable. This time, however, the regulatory hurdles were particularly high. Google is currently under intense scrutiny from U.S. regulators, who are suing the company in two separate antitrust cases. One case targets Google's ubiquitous search engine, while the other seeks to break up the company's digital advertising technology. A decision in the search engine case is expected this summer. Under President Biden, regulators have taken a closer look at corporate mergers. The Federal Trade Commission unsuccessfully tried to block Microsoft's acquisition of video game company Activision, and Amazon abandoned its $1.7 billion acquisition of iRobot after facing resistance from American and European regulators. A regulatory review of a multi-billion-dollar acquisition could take more than a year and would be costly for Wiz, which is characterized by rapid growth. The company announced earlier this year that it has achieved an annual revenue of over $350 million, up from $100 million two years ago. Rappaport stated in his memo that the attention in recent days has strengthened his conviction to create an independent platform. "The market valuation we have experienced after this news only reinforces our goal," he wrote, "to create a platform that both security and development teams love.