Virgin Orbit, billionaire Richard Branson’s company that was on the race to space, is laying off nearly all of its workers and preparing for a possible shutdown.
The company dedicated to the launch of satellites has ceased its operations until further notice, therefore, it will cut 85% of its personnel. That is, some 675 employees who will leave this April 3, which will affect all departments.
This after not having obtained financing to continue working in January. This information was disclosed through a regulatory document filed with the United States Securities and Exchange Commission (SEC).
The company made the decision while it “carries out discussions with potential funding sources and analyzes strategic opportunities.”
Virgin Orbit is also investigating the failed mission in January to launch nine satellites from the UK and reported a $43 million loss in the third quarter in November.
This is what Dan Hart, the CEO of Virgin Orbit, said when announcing the decision, according to audio obtained by some news outlets:
“Unfortunately, we have not been able to secure funding to provide a clear path for this venture. We have no choice but to implement immediate, dramatic and extremely painful changes. This is probably the hardest meeting I’ve ever had in my life. This company, this team, all of you, mean the world to me. And I have not and will not stop supporting them, whether they continue on this journey or whether they go elsewhere.”
On the other hand, the Branson company has issued a note convertible into shares to Virgin Investments Limited, owned by the same millionaire, to be able to pay the settlements to the people laid off for 11 million dollars. So, these expenses amount to 15 million dollars, money that the aerospace company does not have and has had to be financed.
Takeoff and drop of Virgin Orbit
Richard Branson founded Virgin Orbit in 2017 as a satellite launch company, which, unlike its direct competition with SpaceX and RocketLab, launches from the air, not the ground. It works in collaboration with Virgin Galactic, the aerospace tourism company that takes people (for a small fee) to the edge of space. The firm has plunged more than 40% on the New York Stock Exchange and its shares are worth less than 20 cents.
Published by The Emirates Herald, news and information agency.