Virgin Galactic Merges With Social Capital Hedosophia and Goes Public
Virgin Galactic and Social Capital Hedosophia Announce Merger to Create the World’s First and Only Publicly Traded Commercial Human Spaceflight Company, Virgin Galactic and Social Capital Hedosophia
“VIRGIN GALACTIC (“VG”) and SOCIAL CAPITAL HEDOSOPHIA (“SCH”), a public investment vehicle sponsored by Social Capital and Hedosophia, announced that the boards of directors of each company have approved a definitive agreement under which VG and SCH will merge, with the current shareholders of SCH expected to own up to approximately 49% of the combined company. Upon closing of the transaction, which is expected in the second half of 2019, VG will be introduced as the first and only publicly traded commercial human spaceflight company.”
Marc’s note: Not that I want to quibble with the marketing people who put this together, but you could argue that Boeing, which will soon be sending astronauts to space, is also a publicly traded company that includes human spaceflight as part of their product offering. And ULA, the launch provider, is jointly owned by Boeing.
SPACEHAB was arguably the first publicly traded human spaceflight company. IPOed December 1995
Looks like they forgot that Scaled Composites is owned by Northrop-Grumman which is a public traded company and they have already sent humans up in SpaceShipOne. And SpaceDev, who built SpaceShipOne’s engines was also a public company at the time. So at best they are just fourth or fifth, depending on how you count the Space Shuttle, which also flew commercial mission specialists.
That said, it will be entertaining to see the financials on this. I always saw Virgin Galactic as just a loss leader for promoting the Virgin family of brands.
Also Sir Richard Branson is going to have to start watching what he says. If he keeps putting out the hype he has in the past about VG the SEC will be paying him a visit, and it won’t be a social one.
They also point out why they can easily take on all comers:
“VG believes its position within the emerging commercial human spaceflight market is reinforced by other significant barriers to entry for potential competitors. These include the vertically integrated technical and operational expertise built over 15 years”
I guess the marketing people thought that sounded better than “No one has more experience attempting to enter the commercial human spaceflight market than we do.”
Going public before delivering a single product to a paying customer? Sounds like the dotcom boom all over again.
No, its not dotcom, it’s about Unicorns 🙂
https://www.ft.com/content/…
Social Capital heralds new model for unicorn IPOs
All due respect for the persistence involved, and for Branson’s continuing skill at doing his thing with Other People’s Money, but I don’t think I’ll be putting any part of my retirement (such as it is) into this.
The technology involved, airdropped shuttlecock-reentry powered by nitrous hybrid, doesn’t seem to me practically extensible beyond suborbital. Nor, if they do in fact prove out suborbital as a significant ongoing market, does it all seem likely to be the lowest-cost solution. Nor, as already mentioned, does VG’s taking 15 years getting this far mean that anyone else would necessarily take anything like that long. Blue Origin in particular comes to mind as in position to step into this market very soon, and with an apparently simpler system with fewer expendable elements, should that seem like the thing to do.