Some financial analysts believe the company will run out of money in March:
On Monday night Virgin Orbit's attempt to launch a rocket from the United Kingdom failed after a problem with the rocket's second-stage engine.
The US-based launch company did not provide any additional details about the cause of the accident, which led to the loss of nine small satellites on board. In the wake of the failure, officials sought to put a brave face on the mission's outcome and Virgin Orbit's future.
"We will work tirelessly to understand the nature of the failure, make corrective actions, and return to orbit as soon as we have completed a full investigation and mission assurance process," said Dan Hart, Virgin Orbit's chief executive officer, in a prepared statement.
However, the confident words belie a reality that the financial road ahead for Virgin Orbit is a very, very difficult one.
[...] In 2021 the company answered its short-term cash needs by going public, merging with a special purpose acquisition company, or SPAC. However, funds raised from this merger were far less than anticipated. Upon announcing its intent to go public, Virgin Orbit said it anticipated raising $383 million from the proceeds of the SPAC transaction; however, it raised just $68 million from this process and instead had to turn to private investments for an additional $160 million to keep operating.
There is one other financial matter to consider. Earlier in 2022, Virgin Orbit signed an "equity agreement" with an investor group named Yorkville Advisors worth up to $250 million. However, the terms of this agreement are fairly complex. It is not actually an investment in Virgin Orbit by Yorkville, but rather a mechanism by which Yorkville sells shares to public investors.
Essentially, the agreement provided Virgin Orbit with $50 million upfront, but Virgin Orbit cannot tap into the additional $200 million until it pays back this advance. This cannot happen before the summer of 2023, and repaying or "converting" this note too quickly would likely have an adverse effect on Virgin Orbit's stock price.
[...] LauncherOne will likely be grounded for several months, at least, so those funds will not come from launch contracts. Perhaps the most likely source of such funds is the UK government, which stepped in with $500 million in 2020 to save the satellite company OneWeb from bankruptcy. The UK government's explanation for this deal is that it wanted a standalone navigation service.
Would the UK government be willing to do this for Virgin Orbit, which was founded by Sir Richard Branson? An argument could be made that basing Cosmic Girl in Cornwall would give the UK government a sovereign launch capability. However, there are several other UK-based companies, including Orbex and Skyrora, that are likely to come online in a year or two with domestically launched rockets. Accordingly, a UK government investment in Virgin Orbit would seem less justifiable.
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Virgin Orbit files for bankruptcy:
Virgin Orbit, the low-Earth orbit small payload launch company that was spun out of Richard Branson's Virgin Galactic, has filed for bankruptcy protection with the U.S. Securities and Exchange Commission. The bankruptcy filing follows weeks of bad news for the company, including a pause on all operations, a brief hunt for more money to continue as a going concern, and massive layoffs to try to right-size to the company's actual available budget, which today's news essentially confirms was non-existent.
Prior to this fast and furious couple week meltdown, Virgin Orbit had already shown signs that it was essentially on life support: the company's marquee first flight from a brand new British spaceport in January ended in failure due to an anomaly, and there was very little indication on when another attempt might arrive.
Virgin Orbit spun out of Virgin Galactic way back in 2017, as the Branson-backed space company divided its efforts into two separate avenues of focus: Galactic would pursue human spaceflight, targeting suborbital trips for scientists and wealth thrill-seekers. That has borne some fruit, but also hasn't yet achieved the scale and cadence of operation that it aspired to have accomplished at this stage. Orbit, meanwhile, aimed at delivering small payloads to low-Earth orbit, using small rockets that launched from the wings of a large carrier ship, a modified 747-400 commercial passenger aircraft.
[...] Virgin Orbit will seek a sale of the entire company or its assets as possible recourses to resolve its bankruptcy status, the company said in the filing.
Previously:
Even Before Monday's Launch Failure, Virgin Orbit's Finances Were Dismal
Historic UK Mission Reaches Space Falls Short of Orbit
(Score: 2) by PiMuNu on Monday January 16, @07:18PM
Seems technically a dead end as well.