Israeli spyware maker NSO Group has been acquired by an unnamed group of American investors in a deal worth tens of millions of dollars, marking a stunning reversal for a company banned from US trade just three years ago. The acquisition raises serious questions about surveillance technology oversight and America's commitment to protecting democratic freedoms from authoritarian spyware tools.
The controversial Israeli spyware company that's been locked out of American markets since 2021 just found a way back in through the front door. NSO Group spokesperson Oded Hershowitz confirmed to TechCrunch on Friday that "an American investment group has invested tens of millions of dollars in the company and has acquired controlling ownership."
The confirmation came hours after Israeli tech publication Calcalist broke the story, reporting that Hollywood producer Robert Simonds led the acquisition. Simonds, who runs STX Entertainment, had previously explored a takeover bid in 2023 that never materialized. This time, the deal went through - and it's already sending shockwaves through cybersecurity circles.
"This investment does not mean that the company is moving out of Israeli regulatory or operational control," Hershowitz insisted. "The company's headquarters and core operations remain in Israel." But that assurance isn't calming critics who've spent years documenting NSO's global surveillance abuses.
John Scott-Railton, a senior researcher at the University of Toronto's Citizen Lab, told TechCrunch he's deeply concerned about putting NSO under American ownership. "NSO is a company with a long history of going against American interests and supporting the hacking of American officials," he said. "In what world can such a person be trusted to properly oversee a company like NSO Group?"
The timing couldn't be more ironic. Just four years ago, the US Commerce Department banned American companies from doing business with NSO by adding it to the Entities List - essentially a trade blacklist for companies deemed threats to national security. The ban came after NSO's Pegasus spyware was caught targeting about a dozen US government officials abroad in 2021.
But NSO's problems run much deeper than a few hacked American phones. Digital rights researchers have documented dozens of cases where NSO's government customers used Pegasus to target journalists, dissidents, and human rights defenders across Hungary, India, Mexico, Morocco, Poland, Saudi Arabia, and the UAE. The company's tools became synonymous with authoritarian overreach - what Scott-Railton calls "dictator tech."
"My real concern is that NSO has strenuously tried to enter the United States and sell their product to American police forces in US cities," Scott-Railton warned. "This dictator tech does not belong anywhere near Americans, or our constitutionally protected rights or freedoms."
NSO has changed hands repeatedly since its founding by Niv Karmi, Shalev Hulio, and Omri Lavie. US private equity firm Francisco Partners acquired it in 2014, before the founders bought it back in 2019 with help from European firm Novalpina. When that deal collapsed, California-based Berkeley Research Group took over management in 2021. By 2023, co-founder Omri Lavie had regained majority control.
According to Calcalist's reporting, Lavie's involvement with NSO will end as part of this new deal - potentially clearing the way for a fresh start under American ownership. Neither Simonds nor his company STX Entertainment responded to requests for comment, and specific terms of the acquisition remain undisclosed.
The acquisition represents a remarkable corporate resurrection. NSO has been hemorrhaging talent and customers since landing on the Entities List, with several governments distancing themselves from Pegasus amid international pressure. The company has lobbied extensively to get off the US blacklist, even hiring Trump-connected lobbying firms as recently as May 2025.
Now, with American investors at the helm, NSO might have found an end run around those restrictions. The company has long claimed its spyware is designed not to target US phone numbers - a safeguard it maintained to preserve future market access. With US ownership, those barriers to the American surveillance market could finally crumble.
The NSO acquisition marks a pivotal moment in the surveillance technology industry. By bringing one of the world's most controversial spyware makers under American ownership, this deal could fundamentally reshape how democracies approach digital surveillance tools. Whether it represents NSO's rehabilitation or a dangerous erosion of safeguards against authoritarian technology will depend largely on how US regulators respond - and whether they're willing to enforce the same standards on American-owned companies that they applied to foreign ones. The surveillance industry is watching closely, as are the journalists, activists, and officials who've found themselves in NSO's crosshairs.
