Google’s $32 billion acquisition of Wiz could potentially trigger a wave of mergers and acquisitions in the tech industry, according to a renowned industry expert.

In the tech world, a recent acquisition by Google is causing a stir and could potentially lead to a surge in mergers and acquisitions in the tech sector. ARK Invest’s Brett Winton believes that Google’s purchase of cloud security start-up Wiz for $32 billion could trigger a resurgence in tech deal-making across the industry.

Winton, the chief futurist at ARK Invest, a prominent US investment firm known for investing in disruptive technology stocks, sees Google’s acquisition of Wiz not only as a significant milestone for the search giant but also as a potential catalyst for other tech companies to follow suit.

Describing the situation metaphorically, Winton mentioned, “Google just sneezed,” suggesting that other major tech players might catch the M&A bug. He further explained that M&A cycles tend to be contagious, meaning that once one company makes a significant acquisition, others may feel compelled to do the same.

Winton also pointed out that recent antitrust restrictions may have unintentionally provided a shield for dominant players by making it harder for them to acquire competitors. He believes that if merger rules were to relax in the future, it could lead to a wave of deal activities worth billions of dollars.

In this scenario, smaller tech firms would benefit from increased acquisition opportunities, potentially boosting their stock prices and protecting them from short selling pressures. Companies like Alphabet Inc (NASDAQ:GOOG), Microsoft Corp (NASDAQ:MSFT), and Amazon.com Inc (NASDAQ:AMZN) could start acquiring specialized companies to enhance their AI or cloud security offerings.

Google’s acquisition of Wiz, a cloud security company specializing in managing vulnerabilities across multiple cloud providers, is seen as a strategic move to differentiate itself from competitors like Microsoft Azure and AWS, which tend to lock customers into their respective ecosystems. By embracing a more interoperable approach, Google aims to attract businesses seeking flexibility over vendor lock-in.

Overall, Google’s recent acquisition could mark the beginning of a new era of tech M&A activity, benefiting both large tech companies and smaller, innovative firms in the industry. With more acquisitions on the horizon, the tech sector may experience a revitalized sense of growth and opportunity in the coming months.