The shares of Virgin Galactic took Richard Branson, the billionaire founder of the company, to space. Now, they’ve taken a major price hit after the company announced it is raising close to $500 million in bond debt, according to CNN.
“The company intends to use the net proceeds from the offering to fund working capital, general and administrative matters and capital expenditures to accelerate the development of its spacecraft fleet,” Virgin Galactic said in a statement.
Per Market Watch, the company is planning to offer $425 million of convertible bonds in a private offering that mature in 2027.
The company shares went down 16% on Thursday morning, hitting a $10.36 per share low, compared to an all-time high of $62.80 in 2021.
Virgin Galatic was able to launch Branson into space in July 2021 but since then, the company has faced many delays, per a New Yorker report.
- Warning lights went off in the cockpit during Branson’s flight and after that, Federal Aviation has hit pause on all flights pending a review, which concluded in September, giving the company the green light.
- Additionally, they still haven't started commercial services which were supposed to fly paying customers in 2020.