Richard Branson’s Virgin Orbit to Cease Operations After Failed Rocket Launch

Sir Richard Branson speaks after he flew into space aboard a Virgin Galactic vessel in New Mexico on July 11, 2021. Patrick T. Fallon/AFP via Getty Images

Richard Branson’s rocket company Virgin Orbit will cease operations after its failed rocket launch out of the United Kingdom, officials announced.

The company said in a May 23 statement that it will sell its assets and equipment to four winning bidders in a “comprehensive sale process and competitive auction” and cease operations.

The announcement comes just months after the company filed for bankruptcy and laid off roughly 85 percent of its workforce.

“As Virgin Orbit embarks on this path, the management and employees would like to extend their heartfelt gratitude to all stakeholders, including customers, partners, investors, and employees, for their support and dedication over the years,” the company said in a statement.

“It is through their collective efforts that the Company has been able to achieve significant milestones and make lasting contributions to the advancement of satellite launch in the United States and the United Kingdom,” it continued.

“Virgin Orbit’s legacy in the space industry will forever be remembered. Its groundbreaking technologies, relentless pursuit of excellence, and unwavering commitment to advancing the frontiers of air launch have left an indelible mark on the industry,” the statement added.

In a separate statement, rival start-up Rocket Lab said it had purchased Virgin Orbit’s headquarters, rocket factory, and equipment for $16.1 million.

The company said the purchase includes the lease to Virgin Orbit’s 144,000+ square foot headquarters and manufacturing complex in California as well as certain production assets, machinery, and equipment located there.

It does not include Virgin Orbit’s Boeing 747 aircraft, launch vehicles or mobile launch assets for its rockets, or other Virgin Orbit facilities, inventory, and assets.

Rocket Lab CEO and Founder Peter Beck said the transaction “represents a capital expenditure savings opportunity to augment our production capability to bring Neutron to the launch pad quickly to serve our customers and their future success.

“Securing the lease to the Conant Facility adds to our existing presence in Long Beach and provides co-located engineering, manufacturing, and test capabilities for our Neutron team,” Beck added.

The Virgin Orbit's LauncherOne rocket at Spaceport Cornwall, at Cornwall Airport in Newquay, England, in an undated photo provided on March 16, 2023. UK Space Agency via AP

Failed Rocket Launch, Layoffs

The company’s modified Boeing 747, called “Cosmic Girl” was also sold to aerospace firm Stratolaunch for $17 million, Reuters reports.

A spokesperson for Stratolaunch told CNBC that the company plans to share more news about the sale “as it becomes available.”

Rocket engine and spacecraft startup Launcher Inc bought Virgin Orbit’s launch site and lease in the Mojave desert for $2.7 million, court filings show.

The deals, which amount to $35.8 million, are subject to bankruptcy court approval. A hearing to seek Court approval is scheduled to take place on May 24.

Virgin Orbit, which developed rockets to carry small satellites into space, was founded by Richard Branson in 2017 and went public through a blank-check merger in 2021 after raising $255 million less than expected from investors.

The company was once valued at $3.7 billion but announced in March that it would lay off around 85 percent of its 750-strong workforce after failing to raise sufficient investment to continue operating.

“While we have taken great efforts to address our financial position and secure additional financing, we ultimately must do what is best for the business,” Virgin Orbit CEO Dan Hart said in a statement on April 4.

The company filed for Chapter 11 bankruptcy in April shortly after its failed LauncherOne rocket launch from Cornwall in the UK in January—its sixth mission.

Despite a successful takeoff, the system experienced an “anomaly“ during the firing of the rocket’s second-stage engine while it was traveling at a speed of more than 11,000 miles per hour, preventing it from reaching orbit.

Branson also owns the airline Virgin Atlantic and the space tourism company Virgin Galactic.