Virgin Orbit, the sister company of galactic virgin (SPCE), is said to 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 hired Credit Suisse Group AG and LionTree LLC to find a special purpose acquisition company (SPAC) to make it public, sources told the Wall Street Journal on Friday.
The sources also said that Branson expects a valuation of $ 2.5 billion to $ 3 billion for Virgin Orbit. He told CNBC in January that Virgin Orbit was considering a public listing of shares through a SPAC.
A public listing would follow a successful test in January, when a Virgin Orbit rocket launched 10 satellites into space after a major test flight stumbled in May. It was the first time that a horizontal launch system has reached space.
Instead of a vertical launch from the Earth’s surface, Virgin Orbit uses Cosmic Girl, a Boeing (BA) 747, to take the LauncherOne rocket to an altitude of 35,000 feet, where it is launched and ignited to continue in space.
Virgin Galactic shares rose 2.9% to close at 34.55 on the stock exchange today. Boeing, which is an investor in Virgin Galactic, jumped 6.8% on Friday.
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Virgin Orbit to join other space stocks
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.
This was followed by a flurry of blank check activities in the space industry. Earlier this month, Acquisition of vectors (VACQ) announced that it would go public with Rocket Lab 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 Acquisition of stable road (SRAC).
SPACs offer a way for private companies to go public without an IPO. Instead of selling shares, the private company merges with a front company that is already public. SPACs have recently become popular, after years of being shunned by the financial community.
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