Aerospace company Virgin Galactic completed a merger with public investment firm Social Capital Hedosophia (SCH), making it the first publicly traded "space tourism" company
The $800 million merger, which won shareholder approval on October 23, results in a new company called Virgin Galactic Holding, Inc. that has a market capitalization of $2.3 billion.
Shareholders will own nearly 59% of the new company.
Says George Whitesides, CEO of Virgin Galactic Holdings: “Now that Virgin Galactic is a publicly traded company, anyone can invest in a human spaceflight company that is striving to truly transform the market and be part of the excitement of the commercial space industry.
“I am proud of the strong flow of customer deposits and interest we have earned to date and look forward to making the dream of spaceflight come true for our amazing astronaut customers.”
By bypassing a traditional IPO and opting for a merger with publicly-traded SCH, Virgin Galactic began trading on the New York Stock Exchange on October 28, under the new ticker symbol “SPCE”, ”SPCE.U” and “SPCE WS."
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Shares of the new company, which were originally priced at $12.44 at the start of the first day of trading, soared as high as $12.93 before crashing back to earth to $11.80 at the end of trading hours.
Founded in 2004 by British business magnate Sir Richard Branson, Virgin Galactic offers private spaceflights to tourists out of Spaceport America in New Mexico.
The company achieved the first suborbital space flight in December 2018 (and again in February 2019) with its SpaceShipTwo called VSS Unity as part of a test mission.
Says Sir Richard Branson: “With our proprietary spaceflight system, special airspace access at Spaceport America, globally-recognized brand and broad investor interest, I believe Virgin Galactic is ideally positioned to capitalize on the fast-growing, multibillion-dollar commercial space market and ultimately open space to thousands of new astronauts.”
Commercial passenger flights into the surface of space are anticipated to begin in 2020, with tickets going for $250,000 each.
Reservations from more than 600 people in 60 countries have totaled $80 million in deposits and over $120 million in potential revenue.
Chamath Palihapitiya, founder and CEO of SCH, will also serve as chairman of the board of directors for the new company.
“We are pleased to have reached today’s monumental milestone and look forward to continuing to work with the Company to transform the commercial space industry,” says Palihapitiya.
Appearing at The Phocuswright Conference 2019
Hear from Chamath Palihapitiya, founder and CEO of Social Capital and the new chairman at Virgin Galactic.