Israeli cyberattack company Paragon Solutions (now part of REDLattice) has announced it has signed a definitive agreement for a SPAC merger with Bold Eagle (Nasdaq: BEAG). Paragon was founded by former Israeli Prime Minister Ehud Barak and senior veterans of the IDF 8200 intelligence unit, including Brig. Gen. (res.) Ehud Schneorson, who was commander of the unit and his deputy Idan Nurick.
Paragon was sold two years ago for $900 million to AE, a US private equity fund specializing in defense-tech, and was merged with one of its portfolio companies - Virginia-based cyber firm REDLattice. Now, the combined entity, with Paragon constituting the lion's share of the business, is pursuing a merger with a SPAC to expand beyond the intelligence sector and engage in larger-scale government projects.
The merger will be at a pre-money enterprise value of $1.25 billion and will include $335 million of committed capital anchored by Loomis, Sayles & Co., including $60 million common stock Investment led by existing investors AE Industrial and Eagle Equity Partners.
Currently, Paragon accounts for 85% of the combined operation's revenue. The two companies produced a combined $267 million in revenue over the past year, with the Israeli firm contributing over $200 million of that total. The company has 750 employees including 650 in Israel and the remainder in the US. Annual revenue growth rate was 29% compared with the previous year.
Paragon was sold to AE in late 2024 for $900 million; $500 million of this amount was paid in cash to the company's venture capital backers including US-based Battery Ventures and Israel's Red Dot Capital Partners as well as to the founders, while the remaining $400 million was paid out over the following two years based on the achievement of business targets. It is believed the company met its targets, despite its decision to cease providing services to the Italian government following the exposure of a surveillance scandal involving Italian journalists.
Paragon does not disclose its clients, stating only that it serves liberal democratic nations in Western Europe, the US, and the Pacific region. According to the University of Toronto’s Citizen Lab - a cyber research group that frequently exposes the activities of Israeli cyberattack firms - Paragon served countries such as Australia, Canada, Cyprus, Denmark, and Singapore in 2025. Paragon previously held a contract with the US immigration enforcement agency, ICE, but the Department of Homeland Security confirmed to NPR that the contract with the Israeli-American company had ended.
Like its Israeli competitor NSO, Paragon enables governments and security forces to covertly install surveillance software on suspects' smartphones and computers and extract data such as correspondence, documents, and recorded conversations. While NSO gained notoriety for Pegasus, its rival Paragon markets Graphite. Paragon has stated that it allows governments and security forces to monitor suspects involved in terrorism and criminal activity only when a court order has been issued. According to the news site *Benzatin*, the company ceased providing services to the Italian government after the latter refused to cooperate in a joint investigation into the surveillance of journalists and social activists in the country.
The cyberattack industry has undergone major changes in recent years. The Biden administration imposed export restrictions on the Israeli industry, curtailing the export of such software to non-liberal democracies and placing NSO and Candiru - the latter of which was subsequently sold at a loss - on the blacklist. Paragon emerged unscathed from this move, becoming the largest company in the field in Israel, although it was ultimately sold to a US firm with ties to federal intelligence agencies.
Paragon’s operations have also drawn criticism. Investor Michael Eisenberg, currently an advisor to Prime Minister Benjamin Netanyahu, previously attacked the company, claiming its executives had jeopardized national security and undermined the capabilities of the Intelligence Corps' Unit 8200 through aggressive recruitment of personnel from the military. Barak and Schneorson threatened to sue Eisenberg for defamation, demanding a public apology and a payment of NIS 10 million to be donated to public causes. As far as is known, there has been no significant developments in the matter.
It appears that AE now intends to raise funding for the merged REDLattice entity to expand its government-sector operations into products designed to defend against AI-based attacks, as well as forensics products - specifically hardware and software tools for analyzing crimes and attacks - with the aim of securing or expanding government contracts. This move comes just two weeks after Cellebrite - itself a forensics company specializing in counter-terrorism and crime - executed a "flip" transaction, transforming from an Israeli company into a US-based company.
Published by Globes, Israel business news - en.globes.co.il - on September 28, 2026.
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