Virgin Orbit filed for bankruptcy on 3 April, a move that comes shortly after the satellite launch company failed to secure two financing deals and furloughed most of its staff. The California-based company has started the process for a Chapter 11 bankruptcy, which is commonly known as ‘reorganisation bankruptcy’ and allows the company to continue basic operations while it looks for a buyer. Virgin Investments Limited, which is also part of billionaire Richard Branson’s Virgin Group and owns 75 per cent of Virgin Orbit, will provide $31.6 million in support to keep the company afloat until its sale.
Virgin Orbit’s ‘Start Me Up’ mission suffered a rocket launch failure in January 2023 due to a technical error, resulting in the loss of nine customer satellites. By mid-March, the company had paused operations and announced layoffs for about 90 per cent of its workforce. The company was in conversation with two financers but failed to secure a deal, which seemed to be the last straw and the determining factor behind the company’s decision to file for bankruptcy. CEO Dan Hart credited the company for developing a “new and innovative method” to launch satellites into orbit and expressed confidence that the company would get a buyer interested in using the tech to loft satellites in the future. Virgin Orbit employed an air-launch system, in which a carrier plane hauled a rocket high into the sky and dropped it at altitude. “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,” Hart said. “We believe that the cutting-edge launch technology that this team has created will have wide appeal to buyers as we continue in the process to sell the company.”