NSO: but how much is the spy society worth? Valuations from zero to… 2.3 billion
The world of finance could have as its motto “So it is, if you like”, because the value of any unlisted company is based on the card of the company that calculates it. Take the NSO case, the company that created the Pegasus cyber-espionage software. EY, the Big Four accounting firm, valued the Israeli specialist firm at $ 2.3 billion in early 2021. A few months later the firm needed emergency funding in a crisis situation. liquid assets. Congratulations on the evaluation.
EY's valuation, more than double what NSO had received two years earlier and was made by analysts at the company's Luxembourg office in July last year, according to documents viewed by the Financial Times. The estimate of NSO's business value was done without visiting the company or verifying the information provided to analysts, only on paper. As far as EY knew, the company might as well have been a cardboard box.
In contrast, Berkeley Research Group (BRG), a consulting firm representing the Novalpina Capitalm fund, which owns NSO, said earlier this year that the company's capital was "worthless." In October 2021, BRG allegedly made a $ 10 million emergency loan to a sister company of NSO to help meet expenses.
EY's valuation was also much higher than what an unnamed potential buyer had offered just weeks earlier when he proposed to take a minority stake in a deal that valued NSO at $ 1.6 billion, including $ 500 million. dollars of debt. This figure was presented to NSO investors at a 2021 July 2021 meeting.
EY's assessment was made as news of NSO's Pegasus cyber weapon abuse against activists and journalists bounced around the world, so obviously spillover effects on the company's business were to be expected. Around the same time, NSO's proprietary fund was torn apart by infighting, and the spyware maker was sued by Facebook's parent group Meta for hacking its secure messaging platform WhatsApp.
Investment bankers and defense officials are now looking to reassess the company's value as part of a potential deal to spin off NSO's core businesses to L3Harris, a US defense contractor. The sale was meant to avoid a U.S. Department of Commerce blacklist in November 2021, which further damaged the company's reputation and operations. In reality, by becoming partially American, NSO would no longer become "Good", but would simply spy for those who decide the list of good and bad.
In a 132-page report assessing NSO and other companies owned by the private equity group Novalpina Capital, EY described NSO as a "market leader", even though its revenues were down 17% in 2020, while the its competitors had grown up healthily.
Months later, Berkeley Research Group, tasked with liquidating the private equity fund, came to the conclusion that the capital of NSO – once the jewel of Israel's surveillance export industry – was worth zero.
All this is beautiful: EY, one of the famous "Four Sisters" values a company two billion and after a few months the company is about to go bankrupt and worth zero. But trust their reviews.
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The NSO article: how much is the spy society worth? Valuations from zero to… 2.3 billion comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/nso-ma-quanto-vale-la-societa-degli-spioni-valutazioni-da-zero-a-23-miliardi/ on Mon, 27 Jun 2022 15:25:47 +0000.