NEWQUAE, UK – JANUARY 9: A Boeing with a LauncherOne rocket under its left wing as it undergoes final preparations at Cornwall Airport Newquay in Newquay, UK on January 9, 2023 747-400 aircraft, general view of Cosmic Girl. Virgin Orbit launches a LauncherOne rocket from Cornwall’s spaceport, marking the first-ever orbital launch from the UK. This mission is named Start Me Up, after the Rolling Stones hit. (Photo by Matthew Horwood/Getty Images)
Matthew Horwood | Getty Images News | Getty Images
Virgin Orbit The unpaid moratorium will be extended again to continue pursuing investments in Lifeline, CEO Dan Hart told employees in a company-wide email.
Some of the company’s late-stage deal talks, including one with private investor Matthew Brown, fell apart over the weekend, people familiar with the matter told CNBC.
Hart previously planned to update employees on the company’s operations at an all-hands meeting on Monday at 4:30 p.m. ET, according to an email sent to employees Sunday night. bottom. At the last minute, that meeting was rescheduled “for Thursday at the latest,” Hart said in an employee memo on Monday.
An email to employees seen by CNBC said, “Discussions regarding our investment have been very active and ongoing over the past few days and we are not yet at the stage where we can provide a full update. I’m writing.
Brown said last week on CNBC’s “Worldwide Exchange” that he was in final talks about investing in the company. A person familiar with the terms told CNBC that the investment brought him up to $200 million and gave Brown a controlling stake. But discussions between Virgin Orbit and the Texas-based investor stalled and broke down late last week, a person familiar with the matter told CNBC. As of Saturday, those talks were closed, the person said.
Separately, another person said talks with another potential buyer broke down on Sunday night.
The officials requested anonymity to discuss private negotiations. A representative for Virgin Orbit declined to comment.
Hart promised to update Virgin Orbit’s more than 750 employees “daily” this week. Most staff remain on the unpaid furlough Hart announced on his March 15th. Last week, a “small” team of Virgin Orbit employees returned to work in what Hart described as “phase one” of a gradual reopening. “I’m going to prepare the rocket for the company’s next launch.
Virgin Orbit’s shares closed at 54 cents on Monday and dipped below $1 after the company’s shutdown.
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Virgin Orbit developed a system to send satellites into space by dropping rockets from under the aircraft’s wings while in flight, using a modified 747 jet. However, the company’s last mission suffered an in-flight failure when problems occurred during launch, causing the rocket to fail to reach orbit and crash into the ocean.
The company has been looking for new funding for several months, but majority owner Sir Richard Branson is unwilling to provide any further funding to the company.
Virgin Orbit spun out of Branson’s Virgin Galactic in 2017 and counts billionaires as the largest stakeholder with 75% ownership. UAE sovereign wealth fund Mubadala holds his second-largest stake at 18% of him in Virgin Orbit.
The company hired a bankruptcy firm to create a contingency plan in case it could not find a buyer or investor. Branson has priority over Virgin Orbit’s assets, as the company has raised $60 million in debt from Virgin Group’s investment arm.
On the same day that Hart told employees that Virgin Orbit was suspending operations, the company’s board said it would be fired “following a change in control” of the company. Approved the “Golden Parachute” retirement plan for top executives.
