As a company, Virgin Orbit has a very definitive goal, and that’s to deliver small commercial satellites to Earth’s orbit.
Space technology company Virgin Orbit Holdings Inc (NASDAQ: VORB) is facing one of the toughest financial strains in its history and may file for bankruptcy if it fails to secure funding as soon as possible. According to a Fox News report, the company majority-owned by Sir Richard Branson’s Virgin Group has contracted two known restructuring firms, Alvarez & Marsal (A&M) and Ducera on alternative plans should it fail to land new funding soon.
The company has had to halt its operations following what many described as a major financial strain. While the reasons for the halt remain unclear, the firm said it is keeping up work on some core aspects of its operations.
“Virgin Orbit is initiating a company-wide operational pause, effective March 16, 2023, and anticipates providing an update on go-forward operations in the coming weeks, a Virgin Orbit Spokesperson said last week, adding that “On the ops side, our investigation is nearly complete and our next production rocket with the needed modification incorporated is in the final stages of integration and test.”
The strain in the global financial ecosystem is unarguably taking its toll on the California-based company. Virgin Orbit began seeing the major woes of its existence after the failed test to launch from the United Kingdom back in January. As reported by Coinspeaker at the time, the company’s space was expected to deliver about 9 satellites to orbit at the time, and the failure highlighted related events in the company’s short history.
The slump in the company’s shares decelerated at the time and a company that got listed on the NASDAQ through a Special Purpose Acquisition Company (SPAC) has seen a steady slump in its valuation. At listing, it was worth $3.7 billion but at the time of writing, its valuation has also slumped to just $217 million.
Is Virgin Orbit Bankruptcy Impending?
As a company, Virgin Orbit has a very definitive goal, and that’s to deliver small commercial satellites to Earth’s orbit. Since its inception, it has been able to lift off as many as 33 satellites using an adapted Boeing 747 plan designed for Virgin Atlantic.
While its model is supposed to be more robust compared to that of Virgin Galactic Holdings Inc (NYSE: SPCE) which it was spun from, recent events as it relates to mission failures and delays have largely casted doubt on its future.
Now that the firm requires immediate cash injections in order to stay solvent, failure to get these might lead to its bankruptcy, of which the restructuring firms are now employed to help navigate. The news of those willing to invest in the company remains shielded, however, Fox News sources confirmed that one of the company’s shareholders, Boeing Co (NYSE: BA) is not among the latest crop of investors that may help bail out the smaller firm.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
