Virgin Orbit has received a $17 million bid for its aviation assets from hypersonic vehicle company Stratolaunch, according to new court documents released Tuesday (May 16).
pristine orbitwho filed for bankruptcy At the beginning of April after failing to secure long-term financing, and stratolaunchthe manufacturer of the largest aircraft in the world, called Rocklaunched what is called a “stalking horse bid”, which is a term used for an initial offer over the assets of a bankrupt company.
Such a deal leaves the door open to competing bids from other interested parties — including deals for assets Stratolaunch is considering — but locks in the price floor.
Related: Virgin Orbit launch failure leaves opportunity open for UK as space ‘underdog’
The $17 million bid from Stratolaunch, an aerospace company launched in 2011 by the Microsoft co-founder Paul Allen and later purchased by Cerberus Capital Management, focuses on Virgin Orbit’s modified Boeing 747-400 aircraft called cosmic girl as well as related assets necessary to operate the aircraft. Cosmic Girl is known for carrying Virgin Orbit’s LauncherOne rocket into the sky and then dropping it to an altitude of approximately 35,000 feet (10,700 meters), at which point the rocket ignites its onboard engine to travel into the space.
LauncherOne experienced a sequence of four consecutive successful launches which was broken by a failed on his last missionwhich took off from Spaceport Cornwall in England last January.
Virgin Orbit “negotiated extensively with Stratolaunch” over several cycles over the weeks to define the terms of the deal, according to Tuesday court filing. These “tough negotiations” resulted in the $17 million cash offer from Stratolaunch, which has yet to publicly announce its offer. The aerospace company will immediately deposit the amount in escrow if the deal goes through, according to CNBC’s Michael Sheetz.
The failure of Virgin Orbit’s January 2023 mission, called “Start Me Up”, led to the loss of nine customer satellites and was likely a factor on the company’s road to bankruptcy. (A month-long investigation into the failure confirmed that a dislodged fuel filter in LauncherOne was to blame, and a modified design has been incorporated into the next rocket due to fly later this year, officials said. society in a statement last month).
On April 4, shortly after failing to secure long-term financing, Virgin Orbit, which was already operating with a loss of $50.5 million, laid off all but 100 employees and filed for bankruptcy. A month later, the company announced that more than 30 parties had expressed interest in continuing to operate the business and retaining the remaining staff, according to a company statement May 8.
“I am pleased with the number and quality of expressions of interest we have received, which we believe reflect the innovative ideas and hard work the team has put into developing this unique system,” said the Virgin Orbit CEO Dan Hart in this statement.
In early 2022, Hart had spoken of LauncherOne’s potential to go beyond launching small satellites. He said there was some market interest in using the Air Launch System as a propulsion stage for hypersonic vehicles, similar to those developed by Stratolaunch, which will carry them to altitude using Roc. Stratolaunch conducted its first drop test with the giant aircraft and a separation test vehicle last weekend and aims to perform a true hypersonic test later this year.
“We are aware that there have been recall issues in the hypersonic research field,” Hart said. said at the time. “That’s probably an area where we can help.”
The deadline for final bids for the Virgin Orbit sale is Friday, May 19. If multiple companies bid for the company’s assets, a bankruptcy auction will be held on May 22. The final hearing on the company’s sale in court in Delaware, where its bankruptcy was originally filed, is scheduled for May 24.
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