The US Justice Department has opened an antitrust review into Google’s planned $32 billion acquisition of cloud security startup Wiz, according to a Bloomberg report.
The probe, still in its early stages, will assess whether the deal would harm competition in the cybersecurity market. The publication noted that these reviews can stretch for months and may include interviews with customers, rivals, and the merging companies.
The Wiz transaction, announced in March, is a key piece of the tech giant’s cybersecurity product portfolio that includes threat intel and security operations technologies from Mandiant and Siemplify.
Google is no stranger to DOJ scrutiny over its cybersecurity ambitions. In 2022, the $5.4 billion deal for Mandiant was also reviewed by antitrust regulators but the transaction ultimately cleared.
With Wiz, Bloomberg noted that the companies were anticipating pushback, with Google agreeing to a breakup fee of roughly $3.2 billion should the deal fall through.
The proposed deal, which comes a year after Wiz walked away from a $23 billion offer, is expected to reorder the competitive landscape with Microsoft and reshape how investors think about funding cloud security startups.
Google has long struggled for relevance in enterprise cybersecurity (despite strong attempts with Chronicle and VirusTotal) but with the addition of Wiz’s technologies alongside Mandiant assets, the company is chasing an ambitious strategy to integrate reactive and proactive security solutions under one roof.
The Wiz platform is used to scan cloud environments across all major clouds to build a comprehensive graph of code, resources, and connections. It pinpoints potential attack paths and prioritizes risks based on impact, promising tooling for enterprise developers and security teams to secure applications before deployment.
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