Saturday, June 3, 2023
HomeBusinessVirgin Orbit cuts about 85% of its workforce

Virgin Orbit cuts about 85% of its workforce

Virgin Orbit to lay off about 85% of staff © Reuters. FILE PHOTO: The Virgin Orbit building is seen after the company suspended operations last week in Long Beach, California, U.S., March 22, 2023. Reuters/Mike Black

Author : Joey Roulette

(Reuters) – Rocket maker Virgin Orbit Holdings said on Thursday it will cut about 85% of its workforce as it cannot raise new investment. Shares in the company, which is controlled by Richard Branson’s Virgin Group, fell 38% in after-hours trading. About 675 workers will lose their jobs, Virgin Orbit said in a regulatory filing, and the company expects to incur about $15 million in related costs. The filing said the move was the result of “the company’s inability to obtain meaningful funding.” Virgin Orbit went public in 2021 via a blank check deal, raising $255 million less than expected. In addition to its recent failure to raise funds, a failed rocket launch in January has added to the pressure on the company. Reuters reported last week that Texas-based Matthew Brown had been in talks to invest $200 million in the company. Those talks have broken down, two people familiar with the matter told Reuters on Monday, speaking on condition of anonymity. Last week, after Brown appeared on CNBC, Virgin Orbit said in a statement that it was “aware of Matthew Brown’s comments about the company,” adding that it was in investment discussions with potential partners , but declined to comment further. Brown declined to comment on Monday. Branson’s Virgin Group has provided $50 million in financing to the satellite launch company since November, securing debt with its equipment and other assets in case of bankruptcy, securities filings show. Virgin Orbit furloughed nearly all of its 750 employees on March 15 in what a spokesman called an “operational pause” while the company sought a financial lifeline that would allow it to focus on rocket design improvements. A small number of employees returned to work on March 23 to focus on rocket engine work, according to an email sent to employees at the time. The company expects layoffs to be largely complete by April 3.



Please enter your comment!
Please enter your name here


Featured NEWS