Blackstone Group in Talks to Buy 40% of Israeli Cybersecurity Firm NSO Group

Deal would go for $400 million, with ClearSky expected to join as a secondary buyer for 10%

The ticker and trading information for Blackstone Group is displayed at the post where it is traded on the floor of the New York Stock Exchange
Brendan McDermid/REUTERS

Blackstone Group is in advanced talks to acquire 40% of the Israeli cybersecurity firm NSO Group for $400 million, Israel’s Calcalist business newspaper reported on Sunday.

Another investor, ClearSky, is expected to join Blackstone as a secondary buyer, for 10%, Calcalist said.

Founded in 2009 by Omri Lavie and Shalev Hulio, NSO develops software that can target mobile phones to gather information.

Private equity firm Francisco Partners acquired a majority stake in NSO in 2014 for $120 million.

An NSO spokesman said he could not confirm the report.

Calcalist said Francisco Partners could achieve a partial exit via the deal that was four times its initial investment. Six weeks ago NSO distributed a $230 million dividend that will not be included in the deal’s value, the newspaper reported.

Under the deal, Francisco Partners will own 40% of NSO; Blackstone and ClearSky together will hold 40%; the founders will have 6% each and the company’s 500 employees will hold the remaining 8%.

Blackstone was not immediately available to comment. ClearSky did not immediately respond to a Reuters’ request to comment.