Key Points
- The Justice Department is reviewing Google’s $32 billion plan to buy Wiz over concerns it could harm competition.
- At $32 billion, this would be the biggest purchase Google’s parent company, Alphabet, has ever made.
- The companies reportedly pushed the deal forward, hoping for a more favorable regulatory review under the Trump administration.
- Google is on the hook for a $3.2 billion payment to Wiz if the government blocks the acquisition.
The U.S. Justice Department is scrutinizing Google’s planned $32 billion acquisition of cybersecurity company Wiz. According to a Bloomberg report, federal regulators are investigating whether the massive deal violates antitrust laws by harming competition in the market. This would be the largest acquisition in the history of Google’s parent company, Alphabet. The plan is to merge Wiz into Google’s cloud division to beef up its cybersecurity services for business clients.
So far, Google and the Justice Department have remained quiet, declining to comment on the review.
Interestingly, the deal reportedly gained steam right after President Donald Trump took office. Executives at both companies were banking on a friendlier and smoother regulatory process under his administration. This came after they watched Adobe’s $20 billion attempt to buy Figma get blocked by regulators in late 2023. Trump’s recent appointments to lead the FTC and the DOJ’s antitrust division gave the companies the confidence they needed to move forward.
To demonstrate the seriousness of the situation, Google has agreed to pay Wiz a massive $3.2 billion fee if regulators ultimately block the deal.
This new review adds to Google’s growing legal headaches. The tech giant is already fighting other major lawsuits from the DOJ over its control of the online search and advertising markets. A judge recently ruled that Google had illegally maintained a monopoly in key parts of the online advertising industry, a major blow to the company. This new probe into the Wiz deal indicates that regulatory pressure on Google is not easing.
