Google-Wiz Deal “Litmus Test” to manage Trump administrators with great technique

Seven months ago Alphabet She lost the case with the Biden Administration Department of Justice, who has accused the campaign of maintaining an illegal monopoly in search. Weeks earlier, Google’s search for cybersecurity supplier is that it would be its biggest deal if -the, if -the, something frozen Partly out of antitrust care.

Since Donald Trump Returning to the White House, the alphabet returned to the offensive.

Alphabet on Tuesday agreed To buy Wiz for $ 32 billion, almost $ 10 billion is more than the proposed price in mid -2014, and said it expects the deal to close next year, provided regulatory approval.

Wiz will sit in a Google Cloud Division, which is far from the dominant search business. Google behind Amazon and Microsoft In cloud infrastructure, a standing case against a difficult task for any administration would be.

The Federal Trade Commission under Lina Khan was aware of the barbed disappointed Even noticeable Democrats supporters such as Raid Hoffman and Mark Kuban. Google’s pursuit of Wiz can be the first great test for the new FTC chairman Andrew Ferguson, since the technological industry estimates how Trump 2.0 will refer to the industry with six largest market value.

“It will be a great litmus test and Bellwether for M&A in 2025,” said Brad Haler, a senior partner on merger and acquisition at the Consulting Firm West Monroe. “It happens relatively early this year, which means that it can be used as a measuring stick.”

As a company supported by the enterprise, the transaction will become the main wind for Venture Capital Silicon Valle Mainly closed At the beginning of 2022, the Great M&A were at rest. After reaching a maximum of $ 780 billion in 2021, the VC exit the next year fell to $ 89.2 billion and up to $ 71.6 billion in 2023, according to an Anne Report on October With Pitchbook and the National Venture Capital Association. In the third quarter of 2024, their number reached a low five -quarter.

“The big acquisition strategy has returned to the menu for VC companies,” Haller said.

Index Ventures – the largest outside the investor in Wiz, followed by firms, including Sequoia Capital, Insight Partners and Cybestarts.

Going from Google Agreement in July, co -founder Wiz Assaf Rappaport wrote in a note to employees that the company instead pursues IPO. There are some signs that the IPO market is heated because the infrastructure company is artificial intelligence BuissDigital Startup Health Make health and buy now, pay later the lender Clear Recently submitted all avenues in the SEC.

Economic uncertainty is the largest wind, as the introduction of the tariffs of the President Trump on higher trading partners such as China, Mexico and Canada, as well as massive reduction of public expenses, led to extraordinary market volatility and caused concern about business and confidence in consumers. NASDAQ is keeping up for its fifth direct downs and the worst quarterly character since 2022.

For Google, the attractive Wiz appears to be a potential regulatory risk. Reports Reutersciting a source that Wiz has agreed to a fee for more than $ 3.2 billion, which the publication called “one of the highest payments in the history of M&A”.

Google refused to comment.

Founded in 2020. Hit Wiz 100 million dollars of annual repetitive income After only 18 months. Cloud Security products include prevention, active detection and reaction, and they are becoming more important as rapid progress in II has made attacks more sophisticated and potentially more harmful.

“This price tag tells us that Google almost in despair has raised its conscientious security before AI is collecting even more speed,” Gordon Hasket’s analysts wrote on Tuesday’s note.

Google said in statement On Tuesday, announcing that “the increase in the role of II and the adoption of cloud services dramatically changed the security landscape for customers, which made cybersecurity more important in protecting against risks and protection of national security.”

In Wiz’s Message in the blogRapoport said “becoming a part of Google Cloud effectively ties a rocket to our backs.”

The transaction will face regulatory control, but “Google will, in our view, have a stronger case compared to consumers’ acquisitions”, Bank of America analysts write in the note after the announcement. The firm said Google less than 15% of the cloud services market.

Google’s largest acquisition during Biden’s presidency was the purchase of a cybersecurity company at $ 5.4 billion Mandiatory. The search giant was not the only major technology company that felt the normative heat.

In order for Microsoft to eventually closed it Acquisition of $ 69 billion Companies with video games Activision Blizzard at the end of 2023, the company had to survive a 21-month battle with regulators, including the ban on FTC. Agency also are suing the court to court To overdo Meta The acquisition of the virtual reality company inside, though the California District Court Rolled up FTC efforts.

In addition to problems dealing with transactions, meta, AppleAmazon and Microsoft were accused of monopolistic practice or the Ministry of Justice or FTC. In the case of Google, both agencies carried out actions.

In January, Khan told CNBC’s “Squawk Box” that he hoped that Trump administration would not allow Amazon and Meta with hooks with the expected antitrust costumes with a “cute deal”. Her comments came after numerous technological performers and companies, including GoogleThey promised the money for Trump’s inauguration fund.

Ferguson suggested that his FTC would closely monitor the technology, although he did not offer many specifics. During the first Trump administration, the President had a particularly hostile relationship with this industry clap Founder Amazon Jeff BezosEspecially for ownership on the Washington Post as well as aim at Meta and Google for them allegedly prejudice to his administration.

These ex -enemies have made extra effort to change the tone this time or means this record Diversity programs, justice and inclusion or hike to Washington for Trump’s inauguration after formerly Visiting your Mar-A-Lago resort in Florida.

In an interview with Squawk Box last week, Ferguson said that “Big Tech is one of the main priorities” of the administration.

“President Trump has appointed me to protect the Americans in the market,” said Fergusan. “And I said since the first day, Big Tech is one of our main priorities, and that remains true.”

Jonathan Cutter, former Assistant Prosecutor General for Antitrust Department of the Ministry of Justice at Biden, – Note In the CNBC Power Dining on Tuesday, which seems to be a great regulatory review, probably on the way to the Google-Wiz transaction. He said it was not just about Google’s position in the cloud, but also the amount of data that the company manages.

“I don’t think the WIZ deal will facilitate the road to quick approval,” said the cenbc that is now a participant. “It will be a long road. They will need to look at a lot of documents, a lot of data and understand whether it will really strengthen Google market power in many different markets.”

– Jordan Novo CNBC and Samantha Subin contributed to this report.

See: Full Interview CNBC with FTC Chairman Andrew Ferguson