Virgin Orbit, the private space company, has filed for Chapter 11 bankruptcy protection after officially ceasing its space launch operations. The company has been struggling with financial losses for some time, reporting a loss of $49.2 million in its last fiscal quarter. It attempted to raise funds through a SPAC merger in late 2021 that was expected to generate $483 million for the company. However, the gross proceeds were less than half that amount.
Virgin Orbit’s financial troubles reached a critical point after its “Start Me Up” mission, the first orbital launch from UK soil, failed to reach orbit due to a dislodged fuel filter. The company paused operations and furloughed most employees in mid-March as it sought new investors, but was unable to secure any deals and extended employee furlough by the end of the month.
Late-stage discussions between Virgin Orbit and Texas-based investor Matthew Brown, who was set to inject $200 million into the company, reportedly broke down. This would have been a favorable deal for the launch provider, as the amount would have given the investor a controlling stake. CNBC’s Investing in Space newsletter previously reported that Sir Richard Branson did not want to own the company anymore, even through the bankruptcy process, and that the Virgin Group was rushing to find new sources of funding and buyers.
The company officially closed its space launch operations on March 30th due to a lack of funding, having flown a total of six flights from 2020, only four of which successfully put satellites in orbit. According to the Financial Times, Virgin Orbit reported an expected revenue of $33.1 million and a net loss of around $191 million for the 2022 fiscal year. The company’s search for a buyer will continue under Chapter 11 protection, but if it fails to find a new owner, it may face liquidation.