Sir Richard Branson’s satellite launch company Virgin Orbit has filed for Chapter 11 bankruptcy protection in the US after failing to secure its financial footing. Despite investing roughly 1 billion US dollars (£809 million) into the venture, Virgin Group has been unable to keep the business afloat. This comes after its rocket failed to complete the first satellite launch from UK soil back in January.
On Tuesday, the company lodged a filing with the US Bankruptcy Court in Delaware as it seeks a sale of its remaining business. As part of this procedure, the group recently announced the dismissal of 675 employees – 85% of the entire staff. Additionally, Virgin Orbit, which is based in California and 75% owned by Virgin Group, also suspended its operations in March due to growing financial pressure.
To ensure the process goes smoothly, Virgin Investments has injected roughly 43 million US dollars (35 million pounds) into the business to cover operational costs and provide severance packages for its soon-to-be former staff.
Virgin Orbit CEO Dan Hart issued a statement about the filing. He said, “The team at Virgin Orbit has developed and brought into operation a new and innovative method of launching satellites into orbit, introducing new technology and managing great challenges and great risks along the way as we proved the system and performed several successful space flights. 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. The Chapter 11 process represents the best path forward to identify and finalize an efficient and value-maximising sale.”
Virgin Orbit has become the latest addition to the many firms managed by Sir Richard Branson, the British entrepreneur and founder of the Virgin Group. He has invested billions of dollars into various fields, most notably travel, entertainment and telecommunications. Virgin Orbit, however, is the first astronautic venture of the business magnate.
