Space launch provider, Virgin Orbit Holdings its US subsidiaries has filed a voluntary proceeding under Chapter 11 of the US 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 in the form of $31.6 million new debtor-in-possession (DIP) financing, Virgin Orbit intends to use the Chapter 11 process and the new funds “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”.

Virgin Orbit had previously announced that it was reducing its workforce due to “an inability to raise sufficient out-of-court capital to continue operating its business at the current run-rate”, the company said in a statement.

“The team at Virgin Orbit has developed and brought into operation a new and innovative method of launching satellites into orbit, introducing new technology and managing great challenges and great risks along the way as we proved the system and performed several successful space flights – including successfully launching 33 satellites into their precise orbit. While we have taken great efforts to address our financial position and secure additional financing, we ultimately must do what is best for the business. We believe that the cutting-edge launch technology that this team has created will have wide appeal to buyers as we continue in the process to sell the Company. At this stage, we believe that the Chapter 11 process represents the best path forward to identify and finalise an efficient and maximising sale,” said Dan Hart, chief executive of Virgin Orbit.

“I’m incredibly grateful and proud of every one of our teammates, both for the pioneering spirit of innovation they’ve embodied and for their patience and professionalism as we’ve managed through this difficult time. Today my thoughts and concerns are with the many talented teammates and friends now finding their way forward who have been committed to the mission and promise of all that Virgin Orbit represents. I am confident of what we have built and hopeful to achieve a transaction that positions our Company and our technology for future opportunities and missions.”

Virgin Orbit added that it was “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”.