Virgin Galactic To Become First Listed Human Spaceflight Company

As part of a deal with a publicly traded shell, Richard Branson’s Virgin Galactic space tourism venture would become the first listed company for human spaceflight. Special-purpose acquisition company (SPAC) Social Capital Hedosophia Holdings Corp. reportedly intends to invest approximately $800 million for a stake of 49 percent, The Wall Street Journal reported.

The spaceflight company sees the arrangement as providing it with sufficient capital for funding until the time its spaceships have the ability to operate commercial and churn a profit. However, the company is locked in a race with other firms such as Space Exploration Technologies Corp. and Blue Origin that are also at work on bringing travelers into space.

Virgin Galactic has already brought in over $1 billion since its 2004 founding, primarily from Branson per the report. In 2017, Saudi Arabia’s Public Investment Fund announced plans for a $1 billion investment in the firm, but Branson later suspended those discussions.

Social Capital LP Chief Executive Chamath Palihapitiya then met with the billionaire along with his team about a potential investment via a SPAC he rolled out in 2017. The parties worked through the details for much of this year and executives of  Virgin Galactic met with investors in recent times to get a sense of their interest. It was also noted that Palihapitiya will serve as the company’s chairman.

The space industry today is worth around $400 million, according to UBS, which it anticipates will double to $800 million by the year 2030 per reports earlier this year. The space travel and tourism sub-sectors, they noted, will be a small sub-segment, but an important one.

Private space companies “are investing aggressively across the space opportunity,” UBS said, and the firm believes access to space “is the enabler to broader opportunities for investment. Long-haul airplane flights of more than ten hours, the report noted, could easily “be cannibalized” by point-to-point flights on rockets.