Virgin Orbit says space startup in talks with potential investors

Virgin Orbit Holdings

23/03/2023 19:42

March 23 (Reuters) - Billionaire Richard Branson's
cash-strapped satellite launch company Virgin Orbit Holdings
 VORB.O  said on Thursday it is in talks with "interested
parties" about an investment in the company.
    Reuters reported on Wednesday that Texas venture capital
investor Matthew Brown was nearing a deal to invest $200 million
in the space startup via a private share placement, citing a
term sheet Reuters had seen. 
    "As we disclosed on March 16, the company has taken cash
preservation measures as it explores strategic options to secure
Virgin Orbit's future," Virgin Orbit said in a statement. 
    "The company can confirm that it is in discussions with
interested parties about a potential investment in the company,"
Virgin Orbit added. "Beyond this, we will not comment on market
rumors."
    Without elaborating, Virgin Orbit also acknowledged comments
made by Brown on a Thursday interview with CNBC TV.
    Brown confirmed on CNBC he wants to buy Virgin in a deal he
hopes to close by the end of Friday.
    "We are in active discussions. In fact, I would say final
discussions with the company," Brown told CNBC. "We like the
company and we fully plan on transacting with the company within
the next 24 hours." 
    Brown, who describes himself as a "space enthusiast" who has
invested in more than 13 space companies, told CNBC he would own
Virgin Orbit if the deal closes. 
    He did not confirm the contemplated investment amount, but
said the deal would "inject enough capital to make (Virgin
Orbit) cash-flow positive."
    Brown also told CNBC he liked Virgin Orbit's business model.
The company launches a rocket carrying a satellite from the wing
of a Boeing 747, rather than launching from the ground, allowing
for quicker launches according to the company. 
    Brown could not immediately be reached by Reuters to
comment.
    A deal would be a boost of confidence for a company that has
grappled with dwindling cash and mounting losses in recent
quarters in a highly competitive market.          
    Virgin Orbit said on Wednesday it would resume operations on
Thursday and prepare for its next mission by recalling some
employees.
    Virgin Orbit's market capitalization slumped to a record low
of $150 million on Tuesday before reports about Brown emerged
from more than $3 billion two years ago when it went public
through a blank-check deal. On Thursday afternoon, the market
capitalization was about $175 million.
    The company, which received about $35 million of capital
injections from Branson's Virgin Investments in recent months,
said last week it was exploring options and was in talks for
fresh funding.

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EXCLUSIVE-Virgin Orbit near deal to raise $200 mln from Matthew
Brown - term sheet     urn:newsml:reuters.com:*:nL1N35U0OQ
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 (Reporting by Joey Roulette; Writing by Ben Klayman; Editing by
Lisa Shumaker)
 ((benjamin.klayman@thomsonreuters.com; 313-600-2277; Reuters
Messaging: benjamin.klayman.thomsonreuters.com@reuters.net))