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- Virgin Orbit filed for Chapter 11 bankruptcy protection in the US on Tuesday after failing to secure a funding lifeline.
- CNBC came after it obtained audio of Virgin Orbit CEO Dan Hart telling employees at an all-hands meeting on Thursday afternoon that the company would cease operations “for the foreseeable future.”
- The company’s last mission suffered a mid-flight failure when problems occurred during launch, causing the rocket to fail to reach orbit and crash into the ocean.
The company’s modified 747 jet “Cosmic Girl” in Mojave, California.
Virgin Orbit
Virgin Orbit filed for Chapter 11 bankruptcy protection in the US on Tuesday after failing to secure a funding lifeline.
The California-based satellite launch company has filed an application with the United States Bankruptcy Court for the District of Delaware to consider selling its assets.
CNBC came after it obtained audio of Virgin Orbit CEO Dan Hart telling employees at last week’s all-hands meeting that the company was suspending operations “for the time being.” The company also said it would lay off nearly all employees.
Hart said in a statement on Tuesday, “While we have worked very hard to manage our financial situation and secure additional funding, ultimately we must do what is best for our business.
“We believe the cutting-edge launch technology created by this team will have broad appeal to buyers as we continue the process of selling the company.At this stage, we believe the Chapter 11 process is the best way to identify We will complete an efficient and value-maximizing sale,” he added.
Virgin Orbit said it is focused on completing the sale process quickly to make the company’s future clear.
Virgin Orbit said Virgin Investments’ commitments have enabled the company to secure $31.6 million in new funding through “debtor-owned” financing. This process, also known as a DIP loan, refers to financing a company that has filed for Chapter 11 bankruptcy protection to continue operating.
Virgin Orbit developed a system to send satellites into space by dropping rockets from under the aircraft’s wings while in flight, using a modified 747 jet.
The company’s last mission suffered an in-flight failure when problems during launch prevented the rocket from reaching orbit. crashed into the sea.
Virgin Orbit is one of the few US rocket companies to successfully enter orbit with a privately-developed rocket. Starting 6 missions since 2020, counting 4 successes and his 2 failures.
It had been looking for new funding for several months, but majority owner Richard Branson was unwilling to provide any more money to the company.
Branson founded the company in 2017 and owns a 75% stake. Abu Dhabi’s Sovereign Wealth Fund, Mubadala holds his second largest stake at 18%.
The company will enter commercial service in 2021 and began listing on the Nasdaq stock exchange after the so-called SPAC merger. The deal valued the company at about $4 billion at the time.
The image is clearly different from the present. According to Monday’s closing price, Virgin Orbit’s market value was around $65 million.
CEO Dan Hart said, “Today, my thoughts and concerns are the path forward for the many talented teammates and friends who have been committed to all the missions and commitments that Virgin Orbit represents. is found.
“We are confident in what we have built and hope we can achieve a deal that positions our company and our technology for future opportunities and missions,” he added.
— CNBC’s Michael Sheets Contributed to this report.
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