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Report: Virgin Orbit Preparing to Go SPAC

By Doug Messier
Parabolic Arc
June 12, 2021
Filed under , , , , , , , , ,
LauncherOne ignites after being dropped from Cosmic Girl. (Credit: Virgin Orbit)

Following in the footsteps of its sister company, Virgin Orbit is preparing to go public through a merger with a special purpose acquisition company (SPAC), Sky News reports.

Sky News can reveal that Virgin Orbit is close to finalising a deal to combine with NextGen Acquisition II, a special purpose acquisition company (SPAC) set up by George Mattson, a former Goldman Sachs banker.

Sources said this weekend that NextGen II was in exclusive talks with Sir Richard’s Low Earth Orbit satellite business, which is 80%-owned by the tycoon’s Virgin Group empire.

Mubadala, the Abu Dhabi sovereign fund, owns the remaining 20% of Virgin Orbit’s shares.

A definitive deal valuing Virgin Orbit at approximately $3bn (£2.1bn) could be announced in the coming weeks, according to insiders…

The choice of NextGen is a logical one, since Mr Mattson is a director of Virgin Galactic, and is an experienced aviation industry insider, having also been a director of Delta Air Lines for nearly nine years.

A SPAC is an investment company that is already traded on the stock market whose entire purpose is to find a company to acquire and then take the acquisition public under its own name.

Virgin Orbit’s sister company, Virgin Galactic, went public in October 2019 through a merger with Social Capital Hedosophia. A number of other space companies have announced plans to go SPAC as well.

Virgin Group Chairman Richard Branson has previously said that Virgin Orbit had spent about $1 billion getting to orbit. Last year, it was seeking an additional $200 million in direct investment. It is not clear whether the company has completely abandoned that option in favor of going public via SPAC.

Virgin Orbit’s LauncherOne booster has a record of one success and one failure. The rocket failed four seconds after ignition on its maiden flight in May 2020. It succeeded in launching 10 satellites in January in a flight paid for by NASA. Virgin Orbit’s third launch is set for the last week in June.