Virgin Orbit: Richard Branson's rocket firm files for bankruptcy

(image credit: bbc.com)

British billionaire Sir Richard Branson's rocket company Virgin Orbit has filed for bankruptcy in the US after failing to secure new investment.

Virgin Orbit, the satellite launch company, has halted its operations but is hoping to find a buyer for its business. The California-based company, which is mostly owned by Virgin Group, announced last week that it would cut 85% of its 750-strong workforce. The move follows the failure of a Virgin Orbit rocket earlier this year, which did not complete its first-ever satellite launch from UK soil. Despite taking great efforts to address its finances and secure more funding, the company has decided to focus on finding a buyer to provide clarity on the future of the company to its customers, vendors, and employees.

Virgin Orbit was founded in 2017 as a spin-off of Sir Richard Branson's space tourism company Virgin Galactic. It launches rockets from beneath modified Boeing 747 planes to send satellites into space.

However, in January, an attempt to send a satellite into orbit from the UK for the first time failed, causing one of the engines to overheat. Virgin Orbit, which scrambled to find new funding following the UK rocket failure and had debts of $153.5m (£123m) as of September last year, paused operations last month to conserve cash.

On Tuesday, Virgin Investments, part of Virgin Group, announced that it would provide $31.6m in new money to help Virgin Orbit through the process of finding a buyer. The company has filed for what is known as Chapter 11 bankruptcy protection in the US. Melissa Quinn, head of Spaceport Cornwall, said the news about Virgin Orbit was "very sad" but said the site would will "remain focused on furthering the international space industry".

Mr. Hart, Virgin Orbit's boss, said that despite the financial problems, he was confident the company had a "wide appeal" to a new owner because its team had created "cutting-edge launch technology". However, Danni Hewson, head of financial analysis at investment firm AJ Bell, said the company's failed launch mission from the UK was "not the best advert" for its technology. The UK Space Agency said it had worked with Virgin Orbit "for many years" but said its issues were a "commercial matter" for the company.

(image credit: bbc.com)

Sir Richard Branson and Virgin Group have invested more than $1bn in the business, not only to launch satellites through Virgin Orbit but also to develop reusable "space planes" to take tourists on brief trips to sub-orbital space. Virgin Galactic has already started selling tickets for $250,000 for these journeys, and celebrities such as pop star Justin Bieber have signed up. However, the "billionaire space race" has faced criticism for offering joy rides for the super-wealthy at a time when countries across the globe are being impacted by climate change. Mr. Bezos, for example, has insisted that his space exploration is partly an environmental mission to "to take all heavy industry, all polluting industry and move it into space, and keep Earth as this beautiful gem of a planet that it is."