Richard Branson’s Virgin Orbit SPAC public at $ 3.7 billion valuation

Virgin Orbit, the spin-off of Sir Richard Branson’s Virgin Galactic satellite launch, is preparing to go public, announcing Monday that it will merge with a SPAC to appear on Nasdaq.

The company is combining with the special purpose acquisition company NextGen Acquisition Corp. II, as CNBC reported in June. It trades on the Nasdaq under the symbol “NGCA” until the expected close of the transaction towards the end of the year, at which time the shares will convert to “VORB”.

The SPAC – co-led by George Mattson, who previously co-headed global industrial group Goldman Sachs, and former PerkinElmer chairman and CEO Gregory Summe – values ​​Virgin Orbit at $ 3.7 billion in equity.

The deal is expected to raise $ 483 million for Virgin Orbit, including a $ 100 million PIPE round of funding – or private investment in public shares – raised by investors such as Boeing and private equity firm AE Industrial Partners .

A spin-off of Branson-based space tourism firm Virgin Galactic, the company is privately owned by the multinational conglomerate Virgin Group of Branson, with a minority stake from the Abu Dhabi sovereign wealth fund Mubadala – which together have invested around $ 1 billion. dollars in Virgin Orbit to date.

The company uses a modified Boeing 747 to launch its rockets, a method known as an aerial launch. Rather than launching rockets from the ground, like competitors such as Rocket Lab or Astra, the company’s aircraft flies its LauncherOne rockets to around 45,000 feet above sea level and drops them just before cranking the engine and d ‘accelerate through space – a method the company touts as more flexible than a ground-based system.

LauncherOne is designed to carry small satellites weighing up to 500 kilograms, or approximately 1,100 pounds, in the space. Virgin Orbit completed its first successful launch in January and its second in June.

Virgin Orbit aims to be profitable on an EBITDA basis by 2024. The company claims to have approximately $ 300 million in active contracts, with an additional $ 2.3 billion in “identified sales opportunities currently being developed. pursuit “.

The company forecasts revenue of around $ 15 million this year, with an EBITDA loss of $ 156 million. But Virgin Orbit aims to rapidly increase that revenue in the coming years, forecasting $ 2.1 billion in revenue by 2026.

Virgin Orbit is joining a trend of space companies going public through SPAC deals, with Virgin Galactic being the first of a recent generation in 2019. Rocket maker Astra, AST & Science focused on satellite broadband, the data service Spire Global satellite and space delivery specialist Momentus have each started negotiating, with Rocket Lab slated to debut Wednesday and BlackSky, Redwire, Satellogic and Planet slated to follow in the coming months.