Virgin Orbit files for chapter 11 bankruptcy in US
Maverik British billionaire Richard Branson’s satellite launch company Virgin Orbit has filed for bankruptcy in the US after it failed to raise funds. The company has filed for Chapter 11 bankruptcy on 5 April 2023. The bankruptcy filing comes less than two years after Virgin Orbit first went public at a valuation of roughly $3 billion.
The California-based company, which stopped operations weeks ago, announced last week that it would cut 85% of its 750-strong workforce.
In January, a Virgin Orbit rocket failed to complete its first-ever satellite launch from UK soil.
“We believe that the Chapter 11 process represents the best path forward to identify and finalize an efficient and value-maximizing sale,” Virgin Orbit Chief Executive Dan Hart said in a statement.
Dan Hart further said that though the company made great efforts to address its finances and secure more funding, it must do what is best for the business. He said that Virgin Orbit would now concentrate on finding a buyer for the business “to provide clarity on the future of the company to its customers, vendors, and employees”.
The company was founded in 2017 and is a spin-off from Richard Branson’s space tourism company Virgin Galactic. It launches rockets from beneath modified Boeing 747 planes to send satellites into space.
The company’s sixth mission in January using its centerpiece LauncherOne rocket, the first rocket launch out of Britain, failed to reach orbit, sending its payload of commercial and defence-related research satellites plunging into the ocean.
The mishap involving the UK’s Cornwall Spaceport forced the company to halt operations and furlough nearly all of its employees in March to conserve cash.
Virgin Orbit scrambled to find new funding following the UK rocket failure and paused operations last month to conserve cash.
The Nasdaq-listed company had debts of $153.5m (£123m) as of September last year.
On Tuesday, the company said Virgin Investments, part of Virgin Group, would provide $31.6m in new money to help Virgin Orbit through the process of finding a buyer.
Also See: Commercial chapter 11 US bankruptcy filings up 83% in February
