VIRGIN ORBIT HAS STARTED BANKRUPTCY

Richard Branson's space business has cracked. Virgin Orbit, a firm specializing in unique launches of small satellites, announced the beginning of bankruptcy. The company appealed to the Court of the District of Delaware (USA) in accordance with Chapter 11 of the Bankruptcy Code. Court documents state that her assets amount to $243 million, and her debt to creditors is $153.5 million.

The company resorted to judicial protection from creditors to get time to find a buyer. The organization reported serious problems with the financing of the project at the end of March. On March 27, its founder, British billionaire Richard Branson, announced through the press that he would not make financial investments in the company's work. At the same time, his investment firm (Virgin Investments) still provided $ 31.6 million needed for the period of investor search, Forbes clarifies. According to the head of Virgin Orbit, Dan Hart, this will allow us to conclude a deal on optimal terms.

The company Virgin Orbit, located in California, appeared in 2017. The space project, a spin-off from Virgin Galactic, offered a unique way to launch nanosatellites from a modified Boeing 747 airliner in the air. Despite the success of four launches and the launch of 33 satellites into orbit, the company failed to make a profit.

The launch of 10 spacecraft by the LauncherOne rocket on January 17, 2021 was successful. The firm conducted an IPO and was estimated by experts at $3.7 billion. In November 2022, the company received about $1 billion of investments from Virgin Group (the main shareholder of the company with a 75% stake), Kommersant reports. The capital of the organization in the amount of 17.9% is owned by the Mubadala investment fund from the UAE.

The failure that occurred in January 2023 when trying to make the first orbital launch from the territory of the UK brought reputational losses. The company's shares collapsed by 82%. Now its value is estimated at $65 million. Last Monday, the securities again fell in price by 3% and were sold at $0.19 per share.

In March 2023, the company announced that it would lay off up to 90% of its staff (675 employees) in order to reduce costs. The cost of their support will require about $ 15 million. Part of the funds ($8.8 million) will be cash payments to employees. At the same time, investors are in no hurry to invest in a private space business associated with high technical risks and significant financial costs.

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