Virgin Orbit extends employee furlough after finance deal falls through: report
Launch company Virgin Orbit extended unpaid furlough for employees after a financing deal fell through over the weekend, a media report says.
Virgin Orbit was unable to close a potential deal with Texas-based private investor Matthew Brown worth $200 million, CNBC said in a report (opens in new tab) late Monday (March 27). A separate financing discussion with another party also fell through, the report adds. As backup, Virgin Orbit has reportedly secured two restructuring firms, according to an older Sky News report (opens in new tab) published in mid-March.
CEO Dan Hart wrote an all-hands letter on Monday to employees that was viewed by CNBC. “Our investment discussions have been very dynamic over the past few days, they are ongoing, and not yet at a stage where we can provide a fulsome update,” Hart said.
An all-hands meeting with staff originally expected on Monday has also been pushed back to “no later than Thursday,” Hart added.
Virgin Orbit paused operations and furloughed all but a small number of its workforce on March 15, media reports have stated. The company had a poor quarterly earnings report in November, including an operating loss of $50.5 million, with $71 million cash on hand.
Aside from negotiations with Hart, who may have had a controversial past (opens in new tab), another buyer was eyeing a purchase. The talks with the second buyer also collapsed on Sunday (March 26), CNBC said, citing an anonymous source.
The company, which is a part of billionaire Richard Branson‘s Virgin Group, had issues with its debut launch in Cornwall, U.K. early this year; a technical error with the rocket led to a launch failure and the loss of nine satellites. (Virgin Orbit has said the investigation is nearly done and a fix to the rocket was implemented.)
Although Virgin Orbit had four launch successes prior to the failure, Virgin Group had spent something like $1 billion (£818 million) on Virgin Orbit over the years, according to Sky News. A “liquidity crisis” facing Virgin Orbit could not easily be remedied with this funding, a source speaking anonymously to Sky News noted.
Virgin Orbit uses the 70-foot-long (21 meters) LauncherOne rocket to send small satellites into space under the wing of Cosmic Girl, a modified Boeing 747. The plane is designed to send LauncherOne to space after bringing the rocket high in the sky.
In the past, Virgin Orbit representatives said the company stands out in the quickly-crowding launch market because it offers flexible launching locations, as opposed to standard vertical rocket launches from fixed launch sites. Virgin Galactic, another member of Virgin Group, uses a similar style to bring space tourists aloft; those people ride a suborbital spaceliner called VSS Unity that launches from a carrier plane, VMS Eve.
Virgin Galactic is expected to resume operations again as soon as this spring, recent company updates have indicated. No space tourists have flown with Virgin Galactic since July 2021, pending upgrades and maintenance to the fleet.
Elizabeth Howell is the co-author of “Why Am I Taller (opens in new tab)?” (ECW Press, 2022; with Canadian astronaut Dave Williams), a book about space medicine. Follow her on Twitter @howellspace (opens in new tab). Follow us on Twitter @Spacedotcom (opens in new tab) or Facebook (opens in new tab).