Virgin Orbit filed for bankruptcy on Monday (April 3), the move that comes on the heels of the satellite launch company’s failure to secure two financing deals and layoffs of most of its staff.
The California-based company has filed for Chapter 11 bankruptcy, which is commonly known as a “reorganization bankruptcy” and allows the company to continue basic operations while it searches for a buyer. Virgin Investments Limited, which is also part of the billionaire Richard BransonVirgin Group owns 75% of pristine orbitIt will provide $31.6 million in support for the company’s continued operation until its sale, according to A Company statement (Opens in a new tab) Released on Monday (3 April).
Virgin Orbit, founded in 2017, went public in August 2021 by merging with a special purpose acquisition company (SPAC) called NextGen Acquisition Corp. pristine orbit creature (Opens in a new tab) $228 million from that merger — less than half of the $483 million it took in designer. In its most recent quarterly earnings report, released in November 2022, the launch provider indicated that it was She operates at a loss 50.5 million US dollars.
Related: A failed launch of Virgin Orbit leaves the opportunity open for the UK as a ‘dark horse’ in space
Virgin Orbit’s “Start Me Up” mission Missile launch failures In January 2023 due to a technical error that led to the loss of nine satellites belonging to the customer. By mid-March, the company ceased operations and Announce layoffs about 90% of its workforce. Last week, the company spoke with two financiers, however Failed to secure a dealWhat seemed to be the last straw and the deciding factor in the company’s decision to declare bankruptcy.
The company was valued at $65 million at the end of Monday (April 3) and its stock fell 24% on Tuesday (April 4) shortly after declaring bankruptcy, Reuters’ Joe Roulette reported (Opens in a new tab) early on Tuesday.
Virgin Orbit said it was “focused on quickly completing the sale” and filed for bankruptcy in the US Bankruptcy Court for the District of Delaware. Your first hearing will come true (Opens in a new tab) Virtually via Zoom on Wednesday (April 5) at 1:30 PM EST (1730 GMT).
The company said it has already submitted the documents necessary for the Delaware court to approve the use of the company name. Cash in the box, which was $71 million, according to the company’s latest quarterly earnings report. The company also needs Delaware court approval to access Virgin Investments’ $31.6 million. The money will be used to support the Chapter 11 bankruptcy process, “including the uninterrupted payment of wages and benefits to employees,” Virgin Orbit’s representatives wrote in the statement.
In the same statement, Virgin Orbit CEO Dan Hart credited the company for developing an “innovative new way” to launch satellites into orbit, and expressed confidence that the company would attract a buyer interested in using the technology to launch satellites in the future. (Virgin Orbit used the airdrop system, where a carrier plane launched a rocket high into the sky and launched it at altitude.)
“While we have gone to great lengths to resolve our financial situation and secure additional financing, we must do what is best for the business,” said Hart. “We believe that the cutting-edge launch technology that this team has pioneered will be very attractive to buyers as we continue the process of selling the company.”
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