Virgin Orbit SPAC: Sir Richard Branson's Proposed Public Offering

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Jun. 14 2021, Published 10:35 a.m. ET

If you thought SPCE stock went on a ride, just wait until billionaire Sir Richard Branson's next public company hits the market. Virgin Orbit, the satellite spin-off of Virgin Galactic, is going public through a reverse merger or SPAC (not to be confused with the Virgin Galactic ticker).

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Here's what to know about the Virgin Orbit SPAC, including the sizable valuation that Branson's company is getting from the deal.

SPAC behind the Virgin Orbit deal

Every reverse merger is spearheaded by a blank-check company. In the case of Virgin Orbit, it's NextGen Acquisition II.

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The first NextGen Acquisition SPAC (NASDAQ:NGAC) is taking a company called Xos Trucks public. The ticker will transition to reflect Xos once the details of the merger finalize.

Now, NextGen Acquisition II is taking Virgin Orbit public. George Mattson is at the helm of the SPAC. Mattson is a former Goldman Sachs executive, having led the global industrials group. NextGen also has Gregory Summe, the former CEO of PerkinElmer.

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Currently, Branson's Virgin Group—the umbrella that houses Virgin Orbit and Virgin Galactic—is privately held. Mubadala, the Abu Dhabi sovereign wealth fund, holds a minority stake.

How much is the Virgin Orbit IPO worth?

While Virgin Orbit and NextGen Acquisition haven't spoken about the SPAC deal yet, we do know that the merger will be a sizable one.

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Virgin Orbit might achieve a valuation as high as $3 billion. When NextGen Acquisition II went public in March, it raised an aggregate of $383 million. This is expected to help fund Virgin Orbit's upcoming ventures. With Virgin Orbit reportedly seeking $150 million, it should be more than enough to help it scale to the next level.

Investors will likely see the Virgin Orbit SPAC date sooner rather than later.

How soon is the Virgin Orbit SPAC IPO coming? The official announcement will come first. People familiar with the matter suggest that investors will hear a buzz from NextGen and Virgin Orbit executives in the coming weeks. Keep your eyes peeled on the SPAC news cycle for updates on IPO dates and more.

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Will the Virgin Orbit ticker become the next meme stock?

The meme stock brigade has propelled Virgin Galactic's SPCE stock numerous times over the last year. The shares grew at least 125 percent in the first month of 2021, with the 12-month returns somewhat consistent with that peak.

On WallStreetBets, users continue to put in options calls and execute orders for SPCE stock. For Virgin Orbit, whose ticker symbol is still unknown, a future as a meme stock is possible. Branson might view the upcoming stock as more of a stable member of the publicly traded domain than any meme stock could dress up as. The fact that Virgin Orbit has only achieved one successful launch so far doesn't seem to deter the company at all. After all, Virgin Galactic's failed attempts haven't got it booted from the market.

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