Google Seals $32 Billion Wiz Acquisition Amid Regulatory Shift Under Trump

Google has finalized its $32 billion acquisition of Israeli cybersecurity firm Wiz, less than a year after previous talks collapsed. The deal, one of the largest in tech history, came together following a shift in the U.S. administration, sources familiar with the matter revealed.

The agreement, initially valued at $23 billion in July 2024, was renegotiated with a significantly increased offer and a hefty $3.2 billion breakup fee. Executives from both companies saw the change in White House leadership as a key factor in reviving negotiations, as the new administration under President Donald Trump is expected to take a more lenient stance on antitrust reviews.

Regulatory Landscape and Key Players

Google made another bid last fall while Wiz was considering a potential initial public offering (IPO). Although discussions continued sporadically, executives ramped up negotiations following Trump’s inauguration on January 20 and his appointment of key antitrust officials, including Andrew Ferguson as Chair of the Federal Trade Commission (FTC) and Gail Slater to oversee antitrust reviews at the Justice Department.

Fazal Merchant, who joined Wiz as Chief Financial Officer in January, played a crucial role in structuring the deal alongside CEO Assaf Rappaport. Google’s cloud chief, Thomas Kurian, was also instrumental in securing the agreement, sources said.

Sweetened Deal and Breakup Fee Considerations

Wiz executives were ultimately swayed by Google’s revised offer, which represented a 39% premium over the initial bid. The agreement also included an unprecedented reverse breakup fee exceeding $3.2 billion—more than 10% of the total deal value—providing Wiz with significant financial security in case the transaction faced regulatory hurdles.

Google justified the premium, citing Wiz’s impressive 70% annual revenue growth and over $700 million in annualized revenue, a source familiar with the talks stated.

Reverse termination fees, commonly known as breakup fees, are paid by buyers to compensate target companies when deals fail due to regulatory issues. While such fees are becoming more common due to increasing global antitrust scrutiny, the 10% figure in the Wiz deal is significantly higher than the industry average of 4% to 7% for transactions over $1 billion, as reported by law firm Fenwick & West.

Navigating Regulatory Uncertainty

It remains unclear whether Google and Wiz proactively engaged with U.S. antitrust authorities before signing the agreement. Some firms, such as Tempur Sealy in its $4 billion acquisition of Mattress Firm in 2023, have sought preemptive approval to gauge regulatory sentiment.

Wiz executives had been cautious following the collapse of Adobe’s $20 billion bid for Figma in late 2023 due to antitrust concerns. Additionally, Google is currently facing two U.S. Department of Justice lawsuits related to its dominance in online search and ad technology.

Initially, Google had offered Wiz a $2 billion breakup fee, but Wiz and its investors deemed it insufficient given the potential regulatory risks under the previous administration. Concerns were heightened by the stance of then-FTC Chair Lina Khan, who was known for aggressive antitrust enforcement.

With Trump’s administration in place and new FTC leadership, both Google and Wiz executives expressed greater confidence in securing regulatory approval for the deal.

Neither Google, Wiz, the White House, nor Justice Department officials responded to requests for comment. Bank of America advised Google on the transaction, while Goldman Sachs represented Wiz in the negotiations.