Billionaire Richard Branson Is Taking Virgin Orbit Public At A $3 Billion Valuation
Richard Branson’s small satellite launcher Virgin Orbit has announced plans to go public via a SPAC listing on the Nasdaq exchange in a merger that brings in $483 million in cash and values the burgeoning space startup at $3.2 billion.
The merger with blank-check company NextGen Acquisition Corp. II comes after a strong run of success for Branson, including beating fellow space-race billionaire Jeff Bezos to near-space with his space tourism firm Virgin Galactic in July, which followed the successful first launch of a satellite payload by Virgin Orbit in January.
Virgin Orbit achieved a second successful launch in June, during which it deployed 17 satellites for clients including NASA, sparking rumors that Branson would waste no time in bringing the company to public markets on the back of the good news. It will be Branson’s second SPAC listing for a space startup, after he took Virgin Galactic public in October 2019 at a $1 billion market capitalization in a SPAC merger with publicly traded Social Capital Hedosophia, run by former Facebook executive Chamath Palihapitiya. (Virgin Galactic, which has negligible revenues and large losses, now sports a $6 billion market capitalization.)
Branson said in a statement Monday that Virgin Orbit’s team, which uses a rocket fired from a 747 plane to launch satellites into space, has “proven its ability to create new ideas, new approaches and new capabilities.” Branson, who Forbes estimates to be worth $4.4 billion, has led his Virgin Group to spend more than $1 billion developing Virgin Orbit. An investor presentation claims that Virgin Orbit has $300 million in active contracts, with $1.3 billion in contracts under negotiation. In an investor presentation, Virgin predicts revenues will rise from $70 million in 2022 to over $2 billion by 2026. Revenue for 2021, including the two launches in January and June, is estimated at $15 million, according to the presentation.
Virgin Orbit, which will list on Nasdaq under the ticker VORB, is one of a number of space startups to take the SPAC route to market—alongside rivals Rocket Lab, Astra, AST and Spire—as a new entrepreneurial economy begins to open up outside of the atmosphere.
Branson currently owns 80% of Virgin Orbit, with the Emirati sovereign wealth fund Mubadala holding the remaining 20%. They are expected to see their combined 100% diluted to 85% as NextGen’s public shareholders take 10% of the combined company, while other investors take the remaining 5%.