Virgin Orbit is shutting down after selling assets in a bankruptcy auction

The modified Boeing 747, dubbed “Space Girl,” will take off from the Cornwall Space Station in southwest England.

Hugh Hastings/Stringer/Getty Images

Bankrupt rocket company Virgin Orbit is shutting down after auctioning its facility leases and equipment to a trio of aerospace companies, the company confirmed Tuesday.

“As Virgin Orbit embarks on this journey, management and employees want to express their heartfelt gratitude to all stakeholders,” the company said in a statement.

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“Virgin Orbit’s legacy in the space industry will live on forever. Its groundbreaking technologies, relentless pursuit of excellence and unwavering commitment to pushing the boundaries of air launch have left an indelible mark on the industry,” the company added.

It spun out Virgin Galactic In 2017, Virgin Orbit, led by founder Sir Richard Branson, reached rarefied air by completing multiple missions. But difficulty in raising funds and slow execution led the once multi-billion dollar company to bankruptcy and eventually shut down.

Sold in pieces

The rocket for the company’s second demonstration mission is undergoing final assembly at its facility in Long Beach, California.

Virgin Orbit

Bids at Monday’s auction total about $36 million. Virgin Orbit’s six rockets, which were in various stages of production assembly, and its intellectual property have yet to be sold, a Virgin Orbit spokeswoman confirmed.

Rocket laboratory successfully bid $16.1 million for the company’s headquarters in Long Beach, Calif., which is about 140,000 square feet, the spokeswoman said. Although founded in New Zealand, Rocket Lab has already been a neighbor of Virgin Orbit, whose headquarters and facilities are located in the Long Beach area. In addition, Rocket Lab’s purchases include assets such as 3D printers and a custom tank welding machine.

In a press release, Rocket Lab said the Virgin Orbit assets will improve its manufacturing, production and test capabilities, particularly in the development of its larger Neutron rocket.

“With Neutron’s design and development well underway, this transaction represents a capital cost savings opportunity to increase our manufacturing capabilities to rapidly bring Neutron to launch to serve our customers and their future success.” Provision of rent [Virgin Orbit facility] adds to our existing presence in Long Beach and provides joint engineering, manufacturing and testing capabilities for our Neutron team,” said Peter Beck, Founder and CEO of Rocket Lab.

Stratolaunch has won the $17 million “stalking horse” bid for Virgin Orbit’s 747 jetliner. A Stratolaunch spokesperson said in a statement to CNBC that the company is “continually evaluating ways to enhance our capabilities to meet the imperative to test hypersonic technology through flight demonstrations.”

“We will share more news about the sale as it becomes available,” Stratolaunch said.

Earlier in bankruptcy proceedings, Virgin Orbit had agreed to the terms of Stratolaunch’s bid to buy the 747 Cosmic Girl jetliner and other aircraft assets. Stratolaunch is developing its airborne system, the world’s largest aircraft, called the Roc, as a test platform for hypersonic flight.

Launcher, a subsidiary of Vast Space, is buying the company’s facility in Mojave, California, along with some machinery, equipment and inventory for $2.7 million. Virgin Orbit’s Mojave leases include infrastructure such as rocket engine test stands and an aircraft hangar.

The liquidating Inliper Company purchases the company’s office equipment for $650,000.

Launcher did not respond to CNBC’s request for comment.

The bankruptcy court is expected to approve the sale on Wednesday at 2 p.m. ET.

What went wrong?

Here's what drove Virgin Orbit into bankruptcy

Virgin Orbit was fired from Branson’s space tourism company after the team saw potential in using the plane as a platform to launch satellites. While “air-launching” satellites isn’t a new idea for Virgin Orbit, the company aimed to do it faster and more affordably than in previous efforts.

It became one of the few US rocket companies to successfully reach orbit with a privately developed launch vehicle. It has launched six missions since 2020, four successes and two failures, through an ambitious and technically challenging process known as “air launch,” a system that uses a modified 747 jet rocket to launch a rocket mid-flight and launch small satellites into space. to send. .

The company flew most of its missions from Mojave Air and Space Port in California, except for one from the United Kingdom. That January launch was also the last from the UK.

In March, CNBC reported that the company would shut down operations and lay off nearly its entire workforce as it became increasingly desperate for a funding lifeline. But those financial discussions fell through as the company laid off most of its workforce before filing for Chapter 11 bankruptcy protection on April 4.

Former Virgin Orbit CEO Tony Gingis apologized to company employees in a company-wide email sent in April, CNBC reported. Gingiss applauded the Virgin Orbit workforce for being part of “something bold, challenging and fulfilling” but said employees “just didn’t have the leadership or the opportunity to show the world what you can do and how it can be.” this product. sustainable power in the market”.

“You deserved better than this.” Genghis wrote:

While Virgin Orbit aimed to find a wholesale buyer through the bankruptcy process to keep the company’s assets and intellectual property intact, the company was unable to do so, leading to Monday’s auction.

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