US aerospace and defense company L3Harris Technologies (NYSE: LHX) is in talks to acquire Israeli spyware company NSO Group, according to international media reports first published by French website "Intelligence Online."
No financial details about any possible deal were cited but in the past Herzliya-based NSO Group was seeking a buyer for more than $1 billion. Integrity Fund was in talks to buy NSO at a valuation of $1.5 billion including an injection of $300 million, according to the papers in a court case in January.
NSO was blacklisted by the US Commerce Department in November 2021 for allegedly working against US interests abroad and has since then been striving to have the ban lifted but to no avail. In order to protect its Pegasus spyware, NSO has been making efforts to sell its intellectual property and employees to a US company. At the same time, the company is seeking to resolve the lawsuits and the debt left by one of the company's investors in the Novalpina Fund amounting to an estimated $500 million.
Florida-based L3Harris is traded on the NYSE with a market cap of $43.7 billion. The company has $400 million cash in its coffers so if the deal were to go ahead it would be required to seek financing. The company's share price fell 2.7% after news of the negotiations were published.
L3Harris is the sixth largest aerospace and defense supplier in the US following the merger of L3 and Harris in 2019. The company works closely with the US defense authorities in developing technology and installing communications and monitoring equipment. In addition to the US authorities any acquisition would also have to be approved by the Ministry of Defense Export Supervision Department as the sale of IP would be classified as an export.
NSO has not respondent to the report.
Published by Globes, Israel business news - en.globes.co.il - on June 15, 2022.
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