Comment on this story
Comment
Billionaire Richard Branson’s rocket company, Virgin Orbit, announced Tuesday that it filed for Chapter 11 bankruptcy amid a funding shortfall that forced it to freeze operations and lay off most of its staff last week.
The company said in a statement that it filed for bankruptcy in Delaware court and that it will seek a buyer for its business.
“While we have taken great efforts to address our financial position and secure additional financing, we ultimately must do what is best for the business,” CEO Dan Hart said in the statement. “At this stage, we believe that the Chapter 11 process represents the best path forward to identify and finalize an efficient and value-maximizing sale.”
Branson founded Orbit in 2017 as a sister firm to his larger spaceflight company, Virgin Galactic. It achieved an early success in 2021 when it flew a rocket into orbit from the Mojave Air and Space Port in California. But in early January, its first attempt at an orbital launch from the United Kingdom failed, with the company reporting a premature shutdown.
The company has also struggled financially since going public in 2021.
Virgin Investments Limited will provide $31.6 million in “debtor-in-possession” financing, pending approval from the Delaware Bankruptcy Court, to allow Virgin Orbit to keep operating while it searches for a buyer, Virgin Orbit said.
Aaron Gregg contributed to this report.
Source link: https://www.washingtonpost.com/business/2023/04/04/virgin-orbit-bankruptcy-sale-branson/