Google’s $32 Billion Wiz Acquisition Deal Sped Up After Trump’s Inauguration

Google’s deal to acquire Israeli cybersecurity firm Wiz, valued at $32 billion, gained significant momentum after Donald Trump’s inauguration in 2017. Originally, Google had proposed a $23 billion acquisition, but the offer was sweetened to $32 billion with a higher breakup fee of more than $3.2 billion. This revised deal, which would become one of the largest tech acquisitions ever, was strongly influenced by the shift in the U.S. political climate under Trump, particularly with the promise of a more favorable antitrust review.

The deal, which had been under negotiation for nearly a year, saw Wiz considering other options like an IPO. However, after Trump took office and appointed key antitrust officials, the frequency of meetings between Google and Wiz executives increased, culminating in the deal’s closure. The involvement of new Wiz CFO, Fazal Merchant, also helped move the talks forward, ensuring the deal’s success alongside CEO Assaf Rappaport and Google’s cloud chief Thomas Kurian.

A key factor in the deal’s success was the revised offer from Google, which included a significantly higher price for Wiz and an increased breakup fee. Wiz’s executives found it hard to turn down the improved offer, which represented a 39% premium over the previous bid. With Wiz showing impressive annual growth, including a 70% revenue increase and $700 million in annualized revenue, Google justified the premium.

The elevated breakup fee was a notable feature of this deal, as such fees are uncommon in U.S. corporate mergers. However, regulatory threats to large deals have grown, prompting higher fees. Despite concerns about potential antitrust scrutiny from the Federal Trade Commission (FTC), the appointments of Andrew Ferguson and Gail Slater to antitrust positions under Trump helped alleviate fears and contributed to a smoother regulatory process.

source: reuters