Virgin Orbit Holdings, Inc. and its U.S. subsidiaries, a responsive space launch provider, announced on April 3 that it commenced a voluntary proceeding under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court in the District of Delaware in order to effectuate a sale of the business.
With the support of Virgin Investments Limited in the form of debtor-in-possession (“DIP”) financing, Virgin Orbit intends to use the Chapter 11 process to maximize value for its business and assets.
This announcement follows the Company’s previous statement about reducing its workforce due to an inability to raise sufficient out-of-court capital to continue operating its business at the current run-rate.
To help fund the process and protect its operations, the Company has received a commitment from Virgin Investments Limited for $31.6 million in new money DIP financing. Upon approval from the Bankruptcy Court, the DIP financing is expected to provide Virgin Orbit with the necessary liquidity to continue operating as it furthers the marketing process commenced pre-petition to sell the Company and seek a value-maximizing transaction for the business and its assets.
The Company is focused on a swift conclusion to its sale process in order to provide clarity on the future of the Company to its customers, vendors, and employees. In the interim, Virgin Orbit will continue operating in the ordinary course as a “debtor-in-possession” under the jurisdiction of the bankruptcy court and in accordance with the applicable provisions of the U.S. Bankruptcy Code. Virgin Orbit has filed customary motions requesting that the Court authorize the Company’s ability to its use cash on hand and access the DIP financing to support this process, including payment of remaining employee wages and benefits without interruption. The Company intends to pay suppliers and vendors to the fullest extent possible pursuant to normal terms for goods and services provided on or after the filing date. The Company is also committed to working with its customers as it tries to find a buyer that will be able to continue to fulfill their needs.
Top Copyright Photo: Virgin Orbit Boeing 747-41R N744VG (msn 32745) (Virgin Atlantic colors) LGB (Robbie Shaw). Image: 941580.
Virgin Orbit Boeing 747-41R N744VG (msn 32745) (Virgin Atlantic colors) LGB (Michael B. Ing). Image: 944039.
Virgin Orbit has suspended all operations for at least a week and furlough most of its staff in order to cut costs.
The company is looking for additional financing.
Previously on January 9, 2023 the company suffered an “anomaly” on its first orbital attempte from the United Kingdom:
Virgin Orbit
On January 9, 2023, during the first attempted orbital launch from the United Kingdom, Virgin Orbit’s LauncherOne experienced an anomaly, leading to a premature shutdown of the rocket and failure to reach orbit.
Virgin Orbit began its investigation into the failure within hours of the conclusion of the mission, under the leadership of distinguished aerospace veteran Jim Sponnick and Virgin Orbit Chief Engineer Chad Foerster. The failure investigation team received immediate access to extensive telemetry data collected during the mission from the ground stations in the UK, Ireland, and Spain, as well as systems onboard its carrier aircraft, providing a robust dataset that the investigation team has thoroughly examined.
The investigation includes oversight by U.S. Federal Aviation Administration and the UK Air Accidents Investigation Branch (acting as the Space Accident Investigation Authority (SAIA) for the United Kingdom) and also participation by personnel from the Department of Defense, National Transportation Safety Board, and the National Reconnaissance Office. The U.K. Civil Aviation Authority will also be involved in investigation process.
The investigation has confirmed that the Virgin Orbit team successfully executed pre-flight preparations, carrier aircraft takeoff, captive carry flight, and rocket release. The ignition, first stage flight, stage separation, second stage ignition, and fairing deployment of the LauncherOne rocket were nominal. Each of these milestones constituted a first-of-its-kind achievement for any orbital launch attempt from western Europe. LauncherOne performed successfully on all four prior operational flights, accurately delivering 33 payloads to their required orbits.
The investigation team is utilizing a comprehensive fault tree, a very detailed timeline, and several other products to conduct the investigation in a rigorous manner. Key observations at this point in the investigation:
The data is indicating that from the beginning of the second stage first burn, a fuel filter within the fuel feedline had been dislodged from its normal position.
Additional data shows that the fuel pump that is downstream of the filter operated at a degraded efficiency level, resulting in the Newton 4 engine being starved for fuel. Performing in this anomalous manner resulted in the engine operating at a significantly higher than rated engine temperature.
Components downstream and in the vicinity of the abnormally hot engine eventually malfunctioned, causing the second stage thrust to terminate prematurely.
The early thrust termination ended the mission, and the second stage and its payloads fell back to Earth, landing in the approved safety corridor in the Atlantic Ocean.
The investigation is employing a detailed action plan to develop key analyses and tests to replicate flight conditions and to aid in determining the root cause or causes of the failure. All potentially credible scenarios, including the one described above are being investigated. Numerous tests are underway to support the investigation and help lead to definitive conclusions. Ultimately, all credible causes of the failure will be addressed prior to the next LauncherOne mission.
Virgin Orbit’s next launch will occur from the Mojave Air and Space Port in California for a commercial customer. The company anticipates announcing more details about that mission in the coming weeks.
ABOUT VIRGIN ORBIT
Virgin Orbit Holdings, Inc operates one of the most flexible and responsive space launch systems ever built. Founded by Sir Richard Branson in 2017, the Company began commercial service in 2021, and has already delivered commercial, civil, national security, and international satellites into orbit. Virgin Orbit’s LauncherOne rockets are designed and manufactured in Long Beach, California, and are air-launched from a modified 747-400 carrier aircraft that allows Virgin Orbit Holdings, Inc to operate from locations all over the world in order to best serve each customer’s needs.
The company issued this statement on that issue:
Top Copyright Photo: Virgin Orbit Boeing 747-41R N744VG (msn 32745) (Virgin Atlantic colors) LGB (Michael B. Ing). Image: 944039.
