Israel allegedly set up a shell company that has supplied Hezbollah with pagers since 2022, according to a US media report.

Pagers were used in an explosive attack in Lebanon on Tuesday that left 12 members of the terror group dead and thousands injured.

A supply chain trail allegedly led to Hungarian firm BAC Consulting, which appears to have a contract manufacturing beepers under a licensing agreement from Gold Apollo, a Taiwanese company.

However, the Budapest-based company was a front and part of a secret operation to send pagers to Hezbollah in 2022, the New York Times claimed, citing intelligence sources.

The terrorist group wanted the beepers as part of its efforts to avoid Israeli surveillance of mobile phone networks.

But they were allegedly sent devices with explosive-laced batteries made by Israeli intelligence officers, according to the media outlet.

Hsu Ching-kuang, the chairman of Gold Apollo, told reporters on Wednesday that his company had not made the pagers, although they carried its branding.

He said the firm had a three-year licensing agreement with BAC Consulting allowing them to use the trademark on devices it made, and that payments to his company had come from the Middle East.

Reached on the phone by NBC News on Wednesday, Cristiana Barsony-Arcidiacono, the chief executive of BAC Consulting, said: “I do not make the pagers. I am just the intermediary. I think you got it wrong.”

Reporters visited the company’s address at a two-storey building in Budapest to find the name posted to the glass door on an A4 sheet.

A woman who answered the door said she was only there as a headquarters manager and that the firm only receives post once a month, which she is responsible for collecting.

The New York Times said BAC was one of three shell companies created to hide the identities of the real makers of the exploding pagers, according to three intelligence sources.

BAC also took on ordinary clients for which it made a range of ordinary pagers.The pagers intended for Hezbollah were manufactured separately with the explosive PETN added, the sources alleged.

The first pagers were sent in the summer of 2022 but manufacturing increased after a Hezbollah chief warned his followers not to use mobile phones.

In February, Hassan Nasrallah said: “I tell you that the phone in your hands, in your wife’s hands, and in your children’s hands is the agent.

“Bury it,” he added in a televised address. “Put it in an iron box and lock it.”

He ordered all Hezbollah officers to carry pagers at all times, which would be used to send orders in the event of war.

Two American intelligence officials told the New York Times that thousands of pagers arrived in Lebanon over the summer and were distributed among Hezbollah officers and their allies.

Israeli intelligence officers called the pagers “buttons” to be pushed when the time was right.

On Sunday, Benjamin Netanyahu, the Israeli prime minister, said he would do whatever it took to ensure that the some 70,000 Israelis driven away by Hezbollah could return home.

On Tuesday, the pagers were activated and exploded.

Intelligence and defence sources said Israel triggered them to beep before sending a message in Arabic that appeared to come from Hezbollah’s senior leadership.

The pager attacks were followed up with a second wave of explosions emanating from Hezbollah walkie talkies on Wednesday.

Lebanese officials reported 25 dead and 450 injured.