Virgin Galactic shares collapse with plan to sell up to $ 500 million in shares | Business and Economy News


Virgin Galactic unveiled the sale of up to $ 500 million in shares following the success of founder Richard Branson’s flight into suborbital space on Sunday.

Virgin Galactic Holdings Inc. filed to sell up to $ 500 million in shares after a test-driven rocket flight by founder Richard Branson earned Wall Street praise as a “marketing coup.”

The success of the one-hour mission more than 80 miles above Earth propelled Virgin Galactic’s plan to begin offering tourist trips next year. But shares fell further in nearly seven months after Monday’s disclosure of possible stock sales, suggesting the company’s need for additional funds as it prepares for its commercial debut.

“Welcome to the dawn of a new space age,” Branson told guests Sunday at the Spaceport America complex near the city of Truth or Consequences, New Mexico.

Branson’s achievement is a “mass marketing coup” for Virgin Galactic that will hardly be ignored by the general public, Ken Herbert, an analyst at Canaccord Genuity, said in a research note. “The challenge now will be for the company to keep up the momentum and establish a flight plan in 2022 that can demonstrate a repeatable and growing commercial launch rate.”

Virgin Galactic fell 17% to $ 40.69 at the close in New York, the biggest drop since Dec. 14. Volatile stocks, which have been rocked in recent weeks, doubled this year through July 9, as the company resumed its track testing program.

Virgin Galactic plans to start work through a depletion of about 600 confirmed customers in early 2022. The company has said it will resume ticket sales after summer test flights, and executives say rates will be higher than the previous price of $ 250,000 per seat.

A price of $ 300,000 should be affordable, suggested Will Whitehorn, a former Virgin Galactic president who helped establish the company.

“Now that it works, I think they will be able to sell it at a good price,” he said.

Blue origin

The suborbital journey begins a landmark month for the future of space tourism, with Branson demonstrating the capabilities of Virgin Galactic nine days before Inc. founder Jeff Bezos plans to fly a rocket made by Blue Origin, the your space company. Both companies provide companies that cater to wealthy tourists who want to pay the maximum dollar for a short period of weightlessness and an unforgettable view of the Earth and the sky.

Virgin Galactic’s test flight proved that these types of trips, which were already science fiction stuff, are becoming more and more realistic.

While mostly accessible only to a small number of super-rich customers, they would add a new dimension to an expanding industry of private sector space companies with plans for trips to the International Space Station and new advanced human locations.

Branson and his crewmates experienced a few minutes of weightlessness as the Unity reached its maximum altitude.

“So I looked out the window and the view is stunning,” operations engineer Colin Bennett later said. “It’s very Zen; it is also very quiet.

Branson, who founded Virgin Galactic in 2004, said the memories of seeing Earth from space will stay with him.

“I will never be able to do him justice,” he said. “It’s indescribably beautiful.”

(Update actions in the fifth paragraph)

–With the assistance of Blaise Robinson, Ksenia Galouchko, Christopher Jasper, Esha Dey and Tony Robinson.

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