Richard Branson’s rocket firm files for bankruptcy
Richard Branson’s Virgin Orbit Holdings, a California-based satellite launch company and a subsidiary of his Virgin Group, announced on Tuesday that it had filed for Chapter 11 bankruptcy protection in the US.
According to CEO Dan Hart, the company is looking for a buyer for its assets after lodging the filing at the US Bankruptcy Court in the District of Delaware.
“While we have taken great efforts to address our financial position and secure additional financing, we ultimately must do what is best for the business,” Hart said in a statement published on the company’s website.
“We believe that the cutting-edge launch technology that this team has created will have wide appeal to buyers as we continue in the process to sell the company. At this stage, we believe that the Chapter 11 process represents the best path forward to identify and finalize an efficient and value-maximizing sale,” he added.
Virgin Orbit was founded in 2017. Its main achievement was developing a system that uses a modified 747 Boeing jet to send satellites into space by launching a rocket from under the plane’s wing. It has had six missions since 2020, four of which were successful.
However, the company’s last mission in January ended in failure when a technical problem during the launch caused a rocket to crash into the ocean. The firm incurred huge losses and has been trying to secure additional funding ever since. In order to conserve funds, it halted operations and laid off 85% of its staff in mid-March.
According to a US regulatory filing on Monday, Virgin Orbit had been suffering financial problems even before the failed satellite launch. The company said it had not “generated positive cash flows from our operations or generated sufficient revenues to provide sufficient cash flows to enable us to finance our operations” as of December 31, 2022.
On Monday, Virgin Orbit had a market value of approximately $65 million, down from over $3 billion in 2021.
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