Virgin Orbit stock pops more than 20% as Branson’s company shows off rocket in Times Square

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Richard Branson’s satellite-launch company Virgin Orbit brought a rocket on display in New York City on Friday, as it celebrated going public.

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“There’s a Rocket in Times Square, But There Happens [another] One on an airplane right now … we’re doing stuff and I think, at the end of the day, that’s what matters,” Virgin Orbit CEO Dan Hart told CNBC. He rang the Nasdaq opening bell on Friday.

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Shares of Virgin Orbit jumped 26% from its previous close of trading at $6.49 per share.

A spin-off of Branson’s space tourism company Virgin Galactic, the company was held privately by Virgin Group, with a minority stake from Abu Dhabi sovereign wealth fund Mubadala – which has so far invested nearly $1 billion in Virgin Orbit. Is. It merged with SPAC (or Special Purpose Acquisition Company) NextGen Acquisition Corp. II to go public.

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The company raised less than anticipated through the SPAC process. While Virgin Orbit previously estimated that the merger would generate approximately $380 million in SPAC income, the company raised only $68 million — which is expected to result from a higher rate of shareholders exercising redemption.

Virgin Orbit raised further funding through its private investment in a public equity (PIPE) round. The company brought in $160 million through the pipe — instead of just $100 million — from investors including Boeing, AE Industrial Partners, Virgin Group and Mubadala. This brought Virgin Orbit’s total gross income to $228 million.

The company uses a modified Boeing 747 aircraft to launch its rockets, known as Air Launch. Instead of launching rockets from the ground, the company’s aircraft lifts its LauncherOne rockets to an altitude of about 45,000 feet and fires the engines and drops them just before accelerating into space — a method that the company uses to launch ground-based rockets. More flexible than System.

Virgin Orbit joins a collection of rocket-builders that went public through SPAC over the past year, which includes Astra and Rocket Lab.

Hart said, “I respect anyone who has ever launched a satellite into space. It’s not an easy thing to do. But … clearly, almost all the companies that worked on it were in the 1960s.” Re-creating things that have been done.” “We are a launcher that can launch from any location in the world, from any airport – different economics, different access to customers.”

In particular, air-based launches are not a new approach to putting satellites into orbit, since the Pegasus system was developed in the 1990s. Hart called Pegasus “a great idea” done at the wrong time, when smaller satellites lacked capability and meant the rocket was “more curiosity than business”. He also emphasized that Pegasus used additional intercontinental ballistic missiles (ICBMs), which are “not cheap” and “never will be.”

“a liquid [fuel] Rockets are much less expensive to build, especially with current manufacturing techniques,” Hart said.

While the SPAC process netted Virgin Orbit about $250 million less in gross income than expected, Hart said the company’s focus is now on executing the launch. Virgin Orbit aims to launch seven rockets this year, including one next Wednesday. Hart said the company plans to build on that momentum further in the coming years.

“We want to go above 18 launches a year and then we’ll see how the market is doing,” Hart said.

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