In addition to the crisis in the banking sector, it is in dire straits and tycoon Richard Branson’s Virgin Orbit, which is engaged in launching satellites. However, serious liquidity problems forced him to suspend operations and enter into negotiations to secure funding.
On top of that, and since the temporary shutdown will last until March 21, as the company itself announced, almost all of its employees have been suspended from work. If and when they return to duty, they will be notified around the middle of next week.
The Reuters news agency, citing a reliable source, said the move was decided to give Virgin Orbit time to develop and finalize a new investment plan. Its share price fell sharply in morning trading with a loss of 31%, which continued to reach 33.18% by noon at 67 cents on the dollar.
Only because of the initial drop, its capitalization was reduced to about 320 million dollars. It is worth noting that this value is far from the over $3 billion valuation that was reached in 2021 after it was listed on the stock market as a special purpose vehicle.
Virgin Orbit’s market capitalization has shrunk to $320 million from over €3 billion in 2021.
The sharp decline reflects declining investor interest in space startups such as Virgin Orbit and Rocket Lab USA, two companies that are launching rockets in a particularly fiercely competitive environment.
The sluggish interest is also reflected in Rocket Lab’s stock price performance, which has fallen about 70% over the past year. However, in January, the Virgin Orbit LauncherOne rocket failed to send nine small satellites into low Earth orbit due to an anomaly during its flight into space. In November, the company lowered its plan to launch missions in 2022.
In addition, the company posted a loss of almost $44 million in the third quarter ended Sept. 30. At the time, he had cash reserves of about $71 million, up from $122.1 million at the end of June. Virgin Orbit has not announced a release date for its fourth quarter results.
The company raised about $10 million last month and $25 million in November from Richard Branson’s investment firm, Virgin Investments, which is about 75 percent controlling.
Source: Kathimerini
Lori Barajas is an accomplished journalist, known for her insightful and thought-provoking writing on economy. She currently works as a writer at 247 news reel. With a passion for understanding the economy, Lori’s writing delves deep into the financial issues that matter most, providing readers with a unique perspective on current events.