7/9/19 Virgin Galactic plans to go public - Albuquerque Business First
Virgin Galactic plans to go public
Amid a push to bring over 100 more employees to New Mexico, Richard Branson's space tourism company Virgin Galactic plans to go public following an $800 million investment.
Most of that money is set to come from Social Capital Hedosophia Holdings Corp., a company created by Chamath Palihapitiya to help companies like Virgin Galactic go public without doing a traditional IPO. Around $100 million of that investment will come from Palihapitiya himself.
Branson's company is now set to become the first publicly traded human-spaceflight company, thanks to the deal with Palihapitiya unveiled on Tuesday, our sister company Silicon Valley Business Journal reports.
The deal is structured as a $1.5 billion merger in which a shell company set up by Social Capital buys Virgin Galactic in order to take it public without an IPO.
Social Capital will have a 49 percent stake in the new company and Palihapitiya will be the chairman. It will continue to be led by CEO George Whitesides.
In May, Virgin announced it would move over 100 workers from its Mojave, California, operation to Spaceport America near Truth or Consequences. During a press conference then, Whitesides confirmed the company plans to launch its first commercial flight sometime in the next year. The employees were set to begin moving immediately and will continue throughout the summer, bringing the total amount of Virgin employees in New Mexico to around 150, Business First reported.
The door reportedly opened for Palihapitiya's investment after Branson suspended plans to take $1 billion in funding from Saudi Arabia's Public Investment Fund last year in the wake of the murder of Jamal Khashoggi, a dissident writer, in the Saudi embassy in Turkey, according to the Wall Street Journal.
The WSJ reported that Palihapitiya began meeting with Branson and the Virgin team soon after that and have been in talks most of the year.