It’s the last flight for Virgin Orbit Holdings (VORB), as the struggling satellite launch company spun out of billionaire Sir Richard Branson’s Virgin Galactic in 2017 filed for bankruptcy after being unable to raise new capital.
Virgin Orbit wrote in a regulatory filing that it has begun voluntary proceedings under Chapter 11 bankruptcy, just days after indicating it was laying off 85% of its workforce and seeking a buyer because of a shortage of cash.
"Even though the company has taken great efforts to address its financial position and secure additional funding, we ultimately must do what’s best for the business," said CEO Dan Hart. He added that the Chapter 11 process "represents the best path forward to identify and finalize an efficient and value-maximizing sale."
Virgin Orbit noted that it has received a commitment of $31.6 million from Branson’s investment firm, Virgin Investments, in debtor-in-possession (DIP) financing to keep the company running as it pursues a buyer for its assets. Virgin Investments had already injected $10.9 million to pay the costs of the job cuts.
January Launch Failure
Virgin Orbit had successfully launched 33 satellites into orbit, but it ran into trouble in January when its last attempt and the first from British soil failed, sending nine U.S. and U.K. surveillance satellites plunging into the Atlantic Ocean.
Shares of Virgin Orbit are tumbling 23%, and they’ve lost 98% of their value since going public in a special purpose acquisition company (SPAC) deal in December 2021.