Virgin Orbit files for Chapter 11 bankruptcy protection in the US
Image courtesy Virgin Orbit
With the support of Virgin Investments Limited in the form of debtor-in-possession (DIP) financing, Virgin Orbit intends to use the Chapter 11 process to maximise value for its business and assets.
This announcement follows the Company’s previous statement about reducing its workforce due to an inability to raise sufficient out-of-court capital to continue operating its business at the current run-rate.
Dan Hart, CEO of Virgin Orbit said: “The team at Virgin Orbit has developed and brought into operation a new and innovative method of launching satellites into orbit, introducing new technology and managing great challenges and great risks along the way as we proved the system and performed several successful space flights – including successfully launching 33 satellites into their precise orbit.
"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. 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.
"At this stage, we believe that the Chapter 11 process represents the best path forward to identify and finalise an efficient and value-maximising sale. I am confident of what we have built and hopeful to achieve a transaction that positions our Company and our technology for future opportunities and missions.”
To help fund the process and protect its operations, the Company has received a commitment from Virgin Investments Limited for $31.6 million in new money DIP financing. Upon approval from the Bankruptcy Court, the DIP financing is expected to provide Virgin Orbit with the necessary liquidity to continue operating as it furthers the marketing process commenced pre-petition to sell the Company and seek a value-maximising transaction for the business and its assets.
