Virgin Orbit, the sister company of Virgin Galactic (SPCE), will reportedly be the latest space company to go public through a merger with a “blank check company.”
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Richard Branson’s satellite launch company has hired Credit Suisse Group AG and LionTree LLC to find a special purpose acquisition company (SPAC) to take it public, sources told the Wall Street Journal Friday.
The sources also said Branson is looking for a $2.5 billion-$3 billion valuation for Virgin Orbit. He told CNBC in January that Virgin Orbit was considering a public stock listing via a SPAC.
A public listing would follow a successful test in January, when a Virgin Orbit rocket launched 10 satellites into space after a key test flight stumbled in May. It marked the first time a horizontal launch system reached space.
Instead of a vertical launch from Earth’s surface, Virgin Orbit uses Cosmic Girl, a modified Boeing (BA) 747, to take the LauncherOne rocket to an altitude of 35,000 feet, where it is released and ignited to continue on to space.
Virgin Galactic shares climbed 2.9% to close at 34.55 on the stock market today. Boeing, which is an investor in Virgin Galactic, jumped 6.8% Friday.
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Virgin Orbit and Virgin Galactic split in 2017 so Virgin Orbit could focus on low-cost launch services for small satellites for the U.S. military and other customers.
Then Virgin Galactic became the first publicly traded commercial space tourism company in October 2019, after a reverse merger with Social Capital Hedosophia Holdings.
That was followed by a flurry of blank-check activity in the space industry. Earlier this month, Vector Acquisition (VACQ) announced it would take Rocket Lab public in a deal that values the space company at $4.1 billion.
Spire Global, a small satellite provider, also announced plans to go public this month through a merger with NavSight (NSH).
Astra Space is going public via Holicit (HOL), and Momentus is going public via Stable Road Acquisition (SRAC).
SPACs offer a way for private companies to go public without an IPO. Instead of selling stock, the private enterprise merges with a shell company that’s already public. SPACs have become popular recently after years of being shunned by the financial community.
Follow Gillian Rich on Twitter for space news and more.
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