Billionaire Richard Branson’s space tourism venture, Virgin Galactic, announced Tuesday it will be merging with Social Capital Hedosophia (SCH) to create the world’s first publicly traded commercial human spaceflight company.
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Virgin Galactic and the public investment firm agreed to a stock and cash deal — with SCH owning a 49 percent stake of the merged company. SCH’s founder will also invest $100 million at $10 per share, Branson's company said in a news release.
The merger is expected to create a company with an enterprise value of $1.5 billion, Virgin Galactic said.
“Great progress in our test flight program means that we are on track for our beautiful spaceship to begin commercial service. By embarking on this new chapter, at this advanced point in Virgin Galactic’s development, we can open space to more investors and in doing so, open space to thousands of new astronauts,” Branson said in an online statement.
“We are at the dawn of a new space age, with huge potential to improve and sustain life on Earth,” he added. “I am delighted that SCH has decided to become such an important part of our amazing journey. They share our dreams and together we will make them reality.”
Entrepreneur Richard Branson's Space Galactic announced Tuesday it will be merging with Social Capital Hedosophia. (Reuters)
Virgin Galactic was created in 2004 and has received more than $1 billion in investment since then. The aerospace company said the new merger will provide enough monetary support in order for it to reach commercialization.
More than 600 people in 60 countries have dropped roughly $80 million in total to reserve seats on Branson’s vehicles in hopes of being the first to go to space in upcoming years.
“As part of its commercial operations, VG has exclusive access to the principal assets at Spaceport America, New Mexico. Spaceport America is the world’s first, purpose-built commercial spaceport,” the company said Tuesday. “As announced on May 10, 2019, VG is moving more than 100 spaceline staff and its space vehicles to Spaceport America, which will become the new location of its operational headquarters.”
The current team at Virgin Galactic will remain at the company. A new board of seven directors will also be created as part of the merger.