Two of Novalpina Capital’s ousted co-founders have been charged in a London lawsuit with a “malicious and unpredictable campaign” to take back control of the private equity fund that owns Israeli spyware maker NSO Group.

Stefan Kowski and Bastian Lueken, along with co-founder Stephen Peel, were taken control of Novalpina’s €1 billion private equity fund last year in a highly unusual way after investors concluded that the trio had turned out so badly that they couldn’t. longer were able to jointly run it.

Berkeley Research Group, the American consultancy that acquired the fund, is taking Kowski and Lueken to court in London. It said in court files that it is in charge of entities seeking to “reassert control of the fund” despite agreeing not to challenge BRG’s appointment and cooperating with the transfer last year. It doesn’t sue Peel.

The pair say they have “given no instructions” to initiate proceedings in a Luxembourg court to put the fund’s original manager, which they ran, back in charge. Lueken said in court files that BRG’s complaints against him were “unfounded”.

The lawsuit is the latest sign of unrest at the majority-owned company in NSO, which is seeking to return money invested by public pension funds from Yorkshire to Oregon.

It threatens to sow further uncertainty about the future of the spyware maker and the other companies of the Novalpina fund: Estonian gambling company Olympic Entertainment Group and French pharmaceutical group Laboratoire XO.

In the files that Lueken and Kowski describe as “people of certain means”, BRG said the couple only seemed to want to take back control until money was paid to entities in their “camp”.

Still, it said the couple’s actions “pose an existential threat to a fund with $1 billion in investor commitments”. It added that “without prompt intervention by the courts, the fund will suffer potentially irreparable damage”.

Kowski replied that “the situation is exactly the opposite” and said that BRG “mismanaged the fund and caused it to lose value”.

Lueken and Kowski “did their utmost to ensure that the transfer” [to BRG] went smoothly, although their offers of help were sometimes rejected or ignored,” Kowski said in court files for a hearing on Friday.

The couple also allege that their agreements not to challenge BRG are no longer valid because BRG did not abide by its side of the bargain, which was to appoint an independent appraiser of the fund so that it could make disbursements to them.

Although the deposed Novalpina vehicle received a “priority profit-sharing” of $18 million in August, just before BRG took control, Kowski said the “key” payments to the founding partners had not yet been paid.

He said BRG had “refused, and continues to refuse, to appoint an appraiser to carry out a valuation” necessary to determine the amount of the payouts.

EY estimated the fund at $2 billion in June 2021, Kowski said.

The case is pending in the High Court of London and will continue next week.

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