Virgin Orbit Extends Workers’ Furlough After Reportedly Failing to Secure Rescue Deal

Virgin Orbit Extends Workers’ Furlough After Reportedly Failing to Secure Rescue Deal

Private launch company Virgin Orbit is still seeking new funding to help resume its operations after deal negotiations reportedly failed over the weekend.

Richard Branson’s space venture is extending an unpaid furlough for most of its employees as it continues to pause its operations, CNBC reported based on a company-wide email from CEO Dan Hart. “Our investment discussions have been very dynamic over the past few days, they are ongoing, and not yet at a stage where we can provide a fulsome update,” Hart is quoted as saying in the email.

Just last week, company officials seemed optimistic that they would be able to resume operations soon and bring back some employees, even taunting the idea of planning another launch. Virgin Orbit was reportedly on the verge of closing a $US200 ($278) million deal with venture capital investor Matthew Brown. However, a source told CNBC that the discussions between Virgin Orbit and Brown fell apart last week and formally ended on Saturday.

Virgin Orbit was supposed to host an all-hands for its employees on Monday to update them on the status of the company, but that meeting has been pushed to no earlier than Thursday, according to the company email that was viewed by CNBC.

Things are not looking good for billionaire Branson’s private space venture. Virgin Orbit’s financial troubles were triggered by the company’s failed U.K. launch this past January, during which nine satellites were destroyed. The company’s much-touted Start Me Up mission was meant to usher in a new era for Virgin Orbit, launching from British soil for the first time. Instead, its LauncherOne rocket came crashing down, which caused concern among the company’s investors. Virgin Orbit’s stock fell by 22% immediately after, CNBC reported at the time.

The company hasn’t been able to recover since, Virgin Orbit suspended its operations and furloughed most of its employees in mid-March to buy some time as the company works on a new investment plan. The $US200 ($278) million investment from Brown had the potential to unpause the company’s operations, but that now seems unlikely.

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