NSO Group, the spyware company that’s in danger of defaulting on its debts, is considering options that include shutting its controversial Pegasus unit and selling the entire company, according to Bloomberg.

Talks have been held with several investment funds about moves that include a refinancing or outright sale, said the people, who asked not to be identified as the discussions are private.

The prospective new owners include two American funds that have discussed taking control and closing Pegasus. Under that scenario, the funds would then inject about $200 million in fresh capital to turn Pegasus into strictly defensive cyber security services, and perhaps develop the Israeli firm’s drone technology.

However, a spokeswoman for Herzliya-based NSO declined to comment.

According to Bloomberg, the Pegasus software was the flagship of the firm and was considered one of the most powerful cyber-surveillance tools available on the market. The unit responsible for the technology accounted for about half of NSO’s revenue.

It can track a user’s mobile phone, and its misuse has landed NSO at the centre of high-profile privacy abuse cases. The product allegedly was supplied to governments that used it to spy on political dissidents, journalists and activists.

The firm has said it sells the technology to law enforcement and government agencies to prevent crime and terrorism. The US commerce department nevertheless blacklisted NSO. Apple too has sued NSO, seeking to bar it from using its products and services.

The US curbs put added pressure on NSO, which needs to pay back about $450 million in debt, just two years after a management buyout that valued it at about $1 billion.

In December, the Defense Ministry imposed new restrictions on the export of cyber-warfare tools following the major international backlash over the use of Israeli-made surveillance software such as Pegasus.

The Defense Ministry also scaled back the number of countries to which Israeli companies are allowed to sell cyber technologies, a list that consisted of 37 countries, which was down from 102 originally.

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