Richard Branson's Virgin Orbit to go public via $3.2 bn SPAC merger

Billionaire Richard Branson's Virgin Orbit is going public through a merger with a blank-check vehicle in a deal that values it at $3.2 billion and includes an investment from Boeing Co, it said on Monday.

The small satellite launch service provider's deal with NextGen Acquisition Corp. It also includes a private investment in public equity (PIPE) of $100 million. Boeing and AE Industrial Partners participated in the PIPE round, besides other investors.

Shares of NextGen were up 2.4% in premarket trading.

Firefly, U.S.-New Zealand startup Rocket Lab, and Branson's Virgin Orbit are seen as front-runners in a new breed of firms building miniaturized launch systems to cash in on the exponential growth of compact satellites, expected in the coming years.

These firms offer a unique "air-launch" method of sending satellites to orbit with small-launch systems.

Blank-check companies, also known as special purpose acquisition companies (SPACs), use capital they raise through an initial public offering to merge with a private firm and take it public.

Virgin Orbit, which was spun-off from Branson's space tourism company Virgin Galactic Holdings Inc in 2017, reached space for the first time in January when it delivered ten NASA satellites to orbit, after a failed attempt last year.

The company is led by aviation veteran Dan Hart, a former executive at Boeing. Virgin Orbit's government services unit VOX Space LLC is selling launches to the U.S. military. The company won a $35 million U.S. Space Force contract for three missions last year.

The deal with NextGen Acquisition is expected to provide $483 million in proceeds for the combined company. Virgin Orbit will list on the Nasdaq, post the closing of the merger, under the ticker symbol "VORB".

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