EU okays Google’s $32 billion Wiz deal, in largest-ever buyout of Israeli-founded tech co

The largest-ever purchase of an Israeli-founded tech company on Tuesday passed a key hurdle after European antitrust regulators cleared the acquisition of cybersecurity unicorn Wiz by Alphabet’s Google for a staggering $32 billion.

The European Commission said it concluded that the Google-Wiz transaction would raise no competition concerns in the European Economic Area, paving the way for the completion of the deal, which is expected to inject an estimated NIS 10 billion ($3.2 billion) into Israel’s state coffers in tax proceeds. The final closure of the transaction is expected this year, pending regulatory approvals in Australia, South Africa, Turkey, and Israel.

The deal announced in March last year, amid Israel’s war with Hamas in Gaza, marks the largest purchase of an Israeli-founded company after US giant Intel Corp bought Mobileye, a Jerusalem-based developer of advanced vision and driver assistance systems, for $15.3 billion in 2017. For Google, it is the largest acquisition the search giant has ever made, more than double its record purchase of Motorola Mobility for $12.5 billion in 2012.

As part of the deal, Wiz will join Google’s Cloud business, but remain independent. The firm, which says that its cyber platform is tailored to secure any application developers build and run in the cloud, employs about 1,800 workers, a workforce that will remain in place following the closure of the transaction.

Wiz said in response that the European Commission’s approval is a “significant step toward our goal of joining Google Cloud to redefine the future of AI and cloud security.”

“Since this journey began, Wiz has remained steadfast in our mission to empower cloud builders and defenders,” said Wiz in an emailed statement. “By combining Wiz’s deep knowledge of cloud and code with Google’s expertise and scale, we will be able to offer customers more choice in defending against today’s complex threats.”

The deal will boost Google’s cloud security offerings to help it compete with rival tech giants Amazon and Microsoft, and other big cyber firms such as Palo Alto Networks and CrowdStrike.

Google’s largest-ever acquisition is not just another deal that strengthens Israel’s dominance as a global cybersecurity powerhouse — it is also of macroeconomic significance to the country.

Wiz is technically a US company as its mother company and its intellectual property are registered in the US. However, as the four founders of Wiz and many of its employees are Israeli residents and some of its investors are based in Israel, the country’s coffers are set to benefit from a big tax windfall once the deal is sealed.

Wiz was founded in early 2020 by four people who met in the Israeli army and served together in the IDF for almost a decade. Assaf Rappaport, 40, Yinon Costica, 41, Ami Luttwak, 40, and Roy Reznik, 35, are graduates of the famed elite Israeli military intelligence unit 8200, which has built a track record of churning out serial tech entrepreneurs and founders of startups, including Nice, Palo Alto Networks, CyberArk and Waze.

The four Wiz founders in 2012 built their first startup, Tel Aviv-based cloud security firm Adallom, which they sold three years later to Microsoft for $320 million.

The fast success of Wiz has already earned all four founders entry into Forbes’ roster of the world’s richest people, with a net worth of about $1 billion each.