Informed sources told Bloomberg that the Israeli NSO Group is considering closing the Pegasus spyware production unit, as the company is at risk of defaulting on its debts.
According to the sources, the spyware company, which is suffering from the consequences of the scandal of the use of Pegasus software by several governments against its opponents, is at risk of defaulting on its debts, and is looking at options that include closing the Pegasus production unit, or selling the entire company.
The sources said that talks have been held with US investment funds about refinancing, as this scenario includes injecting about $200 million in new capital to convert the technology behind the production of Pegasus into strict defensive cybersecurity services, or the development of drone technology.
And if the Pegasus production unit shuts down, the company will be less valuable than it is now, because the unit represents about half of the company's revenue.
One expert expects the company to record sales of about $230 million this year, 8% less than in 2018.
After the Pegasus scandal was exposed, the US Department of Commerce blacklisted the NSO Group, and Apple filed a lawsuit against it, to prevent it from using spyware in Apple products.
A week ago, the Israeli Defense Ministry said that countries interested in buying its electronic technology would have to commit to using it only to prevent a limited list of terrorist acts and serious crimes, following the aggravation of the Pegasus scandal.
It was also reported last month that Israel had reduced the list of countries eligible to purchase its electronic technology.
NSO denies wrongdoing, saying that it sells its tools only to governments and law enforcement agencies to fight criminals and terrorists, and that it has safeguards in place to prevent misuse of Pegasus.