Virgin Orbit has filed for bankruptcy after the satellite launch company founded by the British billionaire Richard Branson failed to secure the funding it needed to keep operating.
The company listed $243 million in assets and $153.5 million in total debt in a Chapter 11 petition filed in the US state of Delaware. It announced last week it is set to cut 675 jobs, or close to 85 per cent of the workforce.
Following a failed launch in Cornwall in England back in January, Virgin Orbit temporarily halted operations last month while it sought additional capital, and later laid off 675 employees.
The firm, which is part of Branson’s empire that includes airline Virgin Atlantic and space flight company Virgin Galactic, has never made a profit.
When taking payloads into orbit, Virgin Orbit used a technique known as air launch, in which its LauncherOne rocket was deployed at a high altitude from underneath the wing of a modified Boeing 747 plane.
The company started to develop the LauncherOne at Virgin Galactic, several years before the satellite-launch business was formally created.
Virgin Orbit's first successful mission was completed in January 2021, and there were four further flights the following year.
The company had planned to increase the number of launches this year, but had to reassess after the failed January mission, which would have been the first orbital launch from British soil. The rocket never reached orbit after encountering a problem with a fuel filter during the flight, leading to the loss of the nine small satellites it was carrying.
Richard Branson's Virgin Group, which owned roughly 75 per cent of Virgin Orbit, said it had invested over $1 billion in the satellite launching company, including $60 million in secured loans since last November.
Virgin Investments, a subsidiary of Virgin Group, will provide $31.6 million in new money to Virgin Orbit through debtor-in-possession financing to fund operations while it looks for a buyer in bankruptcy, the companies said.
Texas-based Matthew Brown had been in talks to invest $200 million in the company, but it was later said that those talks collapsed, Reuters reported Last month.
Based on its closing share price on Monday, Virgin Orbit has a market value of $65 million, compared with more than $3 billion two years ago.