Houston, we have a problem.
Richard Branson’s bankrupt Virgin Orbit announced it is shutting down for good after a liquidation sale of most of its assets. Consider it a SPAC disaster.
Spun out of space-tourism venture Virgin Galactic in 2017, Virgin Orbit’s business was geared specifically toward a satellite-launching service. But the company didn’t exactly find immediate success, successfully completing just two of its three launches in 2020 and 2021. Still, in a market still gripped by SPAC fever, that proved plenty good enough to go public.
In December 2021, Virgin Orbit underwent a SPAC merger with NextGen Acquisition Corp. at a valuation of $3.7 billion in equity — a valuation that now looks hilariously sky-high in light of its recent liquidation firesale:
- In total, auction bids earlier this week for various pieces of Virgin Orbit equipment and facilities amounted to a measly $36 million. That includes a $16 million sale of the company’s Long Beach, California headquarters to Rocket Lab and a $17 million sale of the orbit-achieving 747 jet “Cosmic Girl” and other aircraft jets to Stratolaunch, a Cerberus portfolio company.
- The company has yet to sell roughly six rockets in varying stages of manufacturing as well as its intellectual property, a Virgin Orbit spokesperson told CNBC.
Earth to Bronson: With the satellite-launching company down for the count, Branson seems to be turning his attention back to the Virgin Galactic mothership even if it’s seeing similar struggles. The company’s shares remain well down from its 2021 peak, and took a tumble of as much as 10% Wednesday on news of Virgin Orbit’s demise. Still, it’s returning to space for the first time in two years on Thursday — where no one can hear you sob.