Virgin Orbit, a company within the Virgin Group that provides launch services for small satellites, has started preparing backup strategies for the possibility of its insolvency just a few days after ceasing its operations and placing its employees on furlough.
“Virgin Orbit is initiating a company-wide operational pause, effective March 16, 2023, and anticipates providing an update on go-forward operations in the coming weeks,” the company says in a statement.
Currently, Virgin Group is working with two restructuring firms, Alvarez & Marsal (A&M) and Ducera, on fallback plans if it is unable to secure new funding, reports Sky News.
The announcement comes a couple of months after the high-profile launch from Cornwall (England) that went badly, ending in the destruction of its satellite payload and prompting an investigation into the root cause of the mishap.
“On the ops side, our investigation is nearly complete and our next production rocket with the needed modification incorporated is in the final stages of integration and test,” says a Virgin Orbit spokesperson.
The shares of Virgin Orbit listed on NASDAQ plummeted 9.14 per cent to $0.65 per share, down from over $10 at its peak in January 2022.
In 2021, Virgin Orbit went public through a SPAC (Special Merger Acquisition) company for a $3.7B deal. Currently, its listed shares are now valued at just $217M, reports Sky News.
Virgin Orbit: What you need to know
Virgin Orbit is a California-based company founded in 2017 by Richard Branson’s Virgin Group.
Its primary focus was to provide affordable and efficient launch services for small satellites.
The company’s unique approach involved launching satellites from a modified Boeing 747 – 400 aircraft, called Cosmic Girl, which would fly to an altitude of around 35,000 feet before releasing the satellite into orbit.
In May 2020, Virgin Orbit’s first orbital launch attempt failed due to an anomaly with the rocket shortly after its release from the aircraft. The company did not achieve orbit and the satellite was lost.
In January 2021, the company successfully launched its first payload into orbit deploying 10 CubeSats into Low Earth Orbit for NASA, demonstrating its ability to compete in the commercial space launch market.
