Novalpina, Oregon State, and the NSO Group
Novalpina Capital is an independent private equity firm based out of London. The Oregon state employee pension fund is one of the largest investors in Novalpina. In fact, Oregon was Novalpina’s first major investor. It committed $233 million to Novalpina Capital in 2017 and has so far provided $65.7 million. In 2019, Novalpina Capital acquired a majority stake in NSO Group. The NSO Group owns the spyware Pegasus. According to investigative reports, the spyware is widely misused by governments across the globe. This development raised alarm bells in the Oregon state fund. Rachel Wray, a spokeswoman for the Oregon state treasury, stated that the treasury was getting involved in the Novalpina investment.
Disagreements Between Co-founders and Pegasus Controversy
Novalpina’s troubles began with internal disagreements between co-founders Peel Kowski and Bastian Lueken. Reports state that the relationship between the co-founders had deteriorated so much that they could no longer work together on investments. On top of this, global news consortium Forbidden Stories published an investigation on the spyware Pegasus. The investigation revealed the wide misuse of the Pegasus spyware against many private citizens including at least 180 journalists. Several world leaders, such as French President Emmanuel Macron, were suspected to be targets. The NSO Group denied that it ever maintained a list of past, present or potential targets. It insists that it only sells to “vetted government agencies” for use against terrorists and major criminals. Additionally, it claims to have no visibility over customer data. However, critics claim that NSO directly manages the high-tech snooping. Oregon state’s treasurer, Tobias Read, says that he is following and is concerned about the press around Novalpina and the NSO Group. An Oregon state spokeswoman said that she could not talk about the discussions between Novalpina’s investors because of confidentiality reasons and Oregon’s role as a limited partner.
Uncertain Future of the NSO Group
According to the financial times, Oregon state might choose the consultancy firm Berkeley Research Group to replace Novalpina. This is a highly unusual step that comes at the end of months of unrest at Novalpina. If appointed, Berkeley’s mandate would be to return the investors’ money. Doing so would mean selling three Novalpina-owned companies, including the NSO Group, to the highest bidder.
