Branson’s Virgin Group takes in $1bn from Galactic share gross sales

Branson’s Virgin Group takes in $1bn from Galactic share sales

Virgin Group Ltd updates

Sir Richard Branson’s Virgin Group has offered $1bn price of shares in Virgin Galactic, the house journey firm that went public via a particular function acquisition firm, in simply over a 12 months. 

The group, which has considerably diminished its stake in Virgin Galactic over the previous 12 months, offloaded one other $300m price of shares earlier this week, in response to filings with the US Securities and Trade Fee, bringing whole gross sales to simply over $1bn. 

Virgin Galactic is regarded as one of many early accelerants of the growth in blank-cheque corporations after it listed in 2019 to a lot fanfare. The house start-up mixed with Social Capital Hedosophia, a Spac led by former Fb government Chamath Palihapitiya, in a deal that valued the corporate at $2.3bn when it listed. The valuation has since virtually trebled to $6.6bn. 

Spacs, which have raised about $110bn to date this 12 months to hunt for personal corporations to take public, have come underneath growing scrutiny from regulators. Officers on the SEC have referred to as for higher transparency round advantages that accrue to insiders. 

Virgin Group began promoting down its stake in Virgin Galactic in Might final 12 months, offloading roughly $568m price of shares over a number of weeks. It made additional disposals in April and August that totalled $450m price of shares together with the $300m offered this week, regulatory filings present. 

A consultant for Branson, who just lately beat Amazon founder Jeff Bezos as the primary billionaire to fly into house, stated the proceeds from the share sale could be used to “assist its portfolio of world leisure, vacation and journey companies that proceed to be affected by the impression of the Covid-19 pandemic”.

Virgin Group has been exhausting hit by the pandemic, with Branson at one level saying he would mortgage his non-public island to assist shore up his struggling companies. He had come underneath criticism for searching for authorities assist in each the UK and Australia. 

Virgin Galactic has been a vivid spot in his enterprise portfolio, with the shares rising to greater than $60 in February. Nevertheless, they’ve misplaced virtually two-thirds of their worth since then and are at present buying and selling at about $25. Morgan Stanley downgraded the inventory to an underweight score earlier this week. 

Michael Colglazier, Virgin Galactic chief government, stated final month the corporate deliberate to supply at the least one flight per day, although he didn’t give a timetable for increasing industrial operations.

Whereas Branson has offered the largest chunk of Virgin Galactic shares, Palihapitiya, one of many firm’s greatest backers, offered the rest of his private funding in March for $200m. The tech investor, who has turn out to be a well-known face on Wall Road after launching a collection of Spacs, stated he would redirect the money to local weather initiatives. 

Palihapitiya and his Spac accomplice, Ian Osborne, nonetheless personal shares they obtained via the blank-cheque car that took Virgin Galactic public.

Virgin Group stays the only largest shareholder in Virgin Galactic with an 18 per cent stake.

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