Shares of Virgin Orbit Holdings Inc. (VORB) dropped sharply on Tuesday as the rocket-launch provider filed for Chapter 11 bankruptcy protection and looks for a buyer. This news has come as a hit to the company, and its already abysmal 89.5% loss of shares this year.
The company, with majority ownership under Richard Branson’s Virgin Group, is confident in the identify and finalizing of an efficient and value-maximizing sale that could happen should they gain approval by the bankruptcy court. In the filing, they will receive $31.6 million in new money debtor-in-possession financing, allowing it to operate as they search for a potential buyer.
This announcement follows Virgin Orbit’s declaration of a mass layoff, which would be implementing an 85% decrease in staff. As a result of Virgin Orbit’s struggles, this news has had an effect on Richard Branson’s other engineering company, Virgin Galactic Holdings Inc. (SPCE).
Virgin Galactic, which went public earlier this year via a SPAC merger and has seen a 76% stock plunge throughout the year, saw their shares take a 1.2% hit in premarket trading.
Richard Branson is the largest shareholder for both companies, owning a large percentage of the stocks according to the FactSet data. He is the Chairman of the corporations and remains confident in the potential of a successful sale of Virgin Orbit.
Virgin Orbit, who specializes in small satellite launches and services with their rocket launchers, is a subsidiary of Richard Branson’s business group known as Virgin Group. The corporation has also expanded into space tourism, creating innovative experiences for its customers. Not only has Virgin Group established Virgin Orbit but it also owns other world-renowned brands such as Virgin Atlantic Airways, Virgin Media, and Virgin Money.
Richard Branson is a global entrepreneur and philanthropist who has succeeded in a wide variety of industries and has become known as a world-class business mogul. In addition to his business successes, Branson has launched several philanthropic initiatives over the years, including the Virgin Unite Foundation, which works to combat issues such as climate change and social injustice. He serves on the boards of many non-profit organizations and has built a reputation as an outspoken advocate for human rights, equal opportunities, education, and sustainability.