Nearly 700 jobs to go at Sir Richard Branson’s rocket company Virgin Orbit Holdings, amid reports it will cease operations
Sir Richard Branson’s cash-strapped Virgin Orbit Holdings has confirmed it will axe the majority of its workforce, amid questions about the firm’s continued operation.
Virgin Orbit confirmed on Thursday in a filing with the US Securities and Exchange Commission (SEC) that it will lay off 85 percent of its staff (or 675 employees) after failing to secure new funding.
It had been reported a few weeks ago that Virgin Orbit had been nearing a deal for a $200-million investment from Texas-based venture capital investor Matthew Brown via a private share placement.
Those talks collapsed, two people familiar with the discussions who asked not to be identified, told Reuters on Monday.
“On March 30, 2023, the Company announced a workforce reduction of approximately 675 employees, constituting approximately 85 percent of the Company’s workforce in order to reduce expenses in light of the Company’s inability to secure meaningful funding,” said the firm in its SEC filing.
“Those impacted are located in all areas of the Company,” it added.
The company expects to take related charges of about $15 million, and it expects that the reduction in force will be substantially complete by 3 April 2023.
Some media reports have suggested that the firm will also cease operations for the foreseeable future.
Virgin Orbit had ambitious plan to carry out the first-ever satellite launch from UK soil, but this went wrong in January 2023 after the LauncherOne rocket failed during the second stage ignition to deploy nine small satellites into lower Earth orbit, due to an ‘anomaly’.
It should be noted that Virgin Orbit’s first attempted a launch in 2020 which also failed, but it has since carried out four successful satellite deployments.
The January 2023 firing of LauncherOne was from a converted 747 jet called Cosmic Girl that took off from Spaceport Cornwall, based at Cornwall Newquay Airport.
Shortly after that, the anomaly wrecked the spaceflight.
In mid February the California-based company identified a displaced fuel filter that caused a Newton 4 engine to overheat, which in turn caused the engine and nearby components to malfunction and for “thrust to terminate prematurely.”
Then matters became worse in mid March when it was reported that Virgin Orbit had begun drawing up detailed contingency plans for its insolvency – days after halting its operations and furloughing its workforce.
Virgin Orbit is 75 percent-owned by Sir Richard’s holding company, and in recent months it has received about $35 million of capital injections from Sir Richard’s Virgin Investments.
Virgin Orbit said this week that Virgin Investments has injected $10.9m into Virgin Orbit “to fund severance and other costs related to the workforce reduction.”