Virgin Orbit secures $31.6m in DiP financing
April 6, 2023
By Chris Forrester
Virgin Orbit has secured $31.6 million (€29.9m) in ‘Debtor in Possession’ financing from its US bankruptcy court in Delaware. The satellite services company said it intends to use the Chapter 11 process to maximise value for its business and assets.
The cash comes from Virgin Investments. “Upon approval from the Bankruptcy Court, the DiP financing is expected to provide Virgin Orbit with the necessary liquidity to continue operating as it furthers the marketing process commenced pre-petition to sell the Company,” said the business.
Virgin’s statement added: “The Company is focused on a swift conclusion to its sale process in order to provide clarity on the future of the Company to its customers, vendors, and employees. In the interim, Virgin Orbit will continue operating in the ordinary course as a ‘debtor-in-possession’ under the jurisdiction of the bankruptcy court and in accordance with the applicable provisions of the US Bankruptcy Code. Virgin Orbit has filed customary motions requesting that the Court authorise the Company’s ability to its use cash on hand and access the DiP financing to support this process, including payment of remaining employee wages and benefits without interruption. The Company intends to pay suppliers and vendors to the fullest extent possible pursuant to normal terms for goods and services provided on or after the filing date. The Company is also committed to working with its customers as it tries to find a buyer that will be able to continue to fulfil their needs.”
The Chapter 11 process includes Virgin Orbit Holdings and four other affiliated debtors.
A virtual hearing (the ‘First Day Hearing’) on the Debtors’ First Day Motions, all fairly routine, was held on April 5th, 2023, before Judge Karen Owens.