Investor behind spyware firm NSO hit by internal bust-up

Business

The London-based private equity firm which owns NSO Group, a controversial spyware provider, has been hit by an internal bust-up between its partners that has cast doubt among investors about its future leadership.

Sky News has learnt that Novalpina Capital, which was set up just four years ago, is embroiled in a dispute that will determine whether Stephen Peel, its high-profile founder, remains at the helm.

The precise origin of the disagreement was unclear this weekend, but Mr Peel’s relationship with Novalpina’s other partners, Bastian Lueken and Stefan Kowski, is understood to have been strained for several weeks.

One source said that they had been at loggerheads over agreeing a strategy for deploying new capital from the fund.

A source close to the situation said that Novalpina’s limited partner advisory committee (LPAC) – formed from a group of major fund investors – had been called on to decide who they would back to continue managing its assets.

A verdict could be reached in the coming weeks, they added.

Established to invest in so-called mid-market companies across Europe, Novalpina boasted when it was launched that its three founding partners had more than 50 years of combined experience in private equity investing.

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Mr Peel was a former partner at TPG, one of the world’s largest buyout firms, while Mr Kowski was a senior executive at Centerbridge Partners, and Mr Lueken led the European investment business at Platinum Equity.

Novalpina’s most prominent deal to date was the acquisition in 2019 of a stake in NSO Group, a cybersecurity company which has drawn controversy over the use of its technology.

Several months after the deal, Novalpina announced a new governance structure for NSO and pledged to align with the UN’s Guiding Principles on Business and Human Rights.

That came at around the same time as Mr Peel’s wife, Yana, resigned as chief executive of London’s Serpentine art gallery, saying that the controversy surrounding NSO’s ownership had prompted “misguided personal attacks on me and my family”.

Novalpina’s other deals have included Laboratoire XO, a pharmaceuticals company, and Olympic Entertainment Group, a gaming business.

More recently, Novalpina was linked with an offer to invest in England’s Rugby Super League, although no transaction has materialised.

Mr Peel declined to comment, while neither Mr Lueken nor Mr Kowski could be reached for comment on Sunday.

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