Virgin Galactic’s value is falling back to Earth despite a successful flight – as the plan to sell shares has announced in business news
Sir Richard Branson’s Virgin Galactic lost more than $ 1 billion in value the day after a successful flight test with crew as plans to sell up to $ 500 million in stock were announced.
The company listed in New York subsequently rose sharply in pre-market deals Sunday outing – with billionaire founder Sir Richard on board.
But it crashed back to earth after the details of the sale, which represent a large portion of its outstanding shares, were revealed in a listing.
The share price lost up to 12% in Monday trading.
Danni Hewson, financial analyst at AJ Bell, said, “The story could well become a blockbuster in its own right, but Richard Branson’s space odyssey returned with one blow when the company announced a whip round.
“Virgin Galactic said the fundraising will help enable more successful spaceflights and the timing of the announcement has been carefully timed to take full advantage of the excitement generated by the launch and safe return.”
Sir Richard’s journey staged Blue origin, a competing space tourism company founded by the former Amazon boss Jeff Bezos.
Mr Bezos is due to fly into space with his brother Mark next week.
The ventures are underpinned by optimism that advances in technology and falling costs will help expand the space market.
Investment bank UBS estimates it could be worth $ 3 billion a year by 2030.
Virgin Galactic’s share price is up more than 80% so far this year, and the company was valued at just under $ 12 billion before the market opened on Monday.
The company plans at least two more test flights in the coming months before entering regular commercial operations in 2022.
Ultimately, the company plans to make several space tourism flights a year and already has more than 600 customers for the $ 250,000 (£ 180,000) seats – including Justin Bieber and Leonardo DiCaprio.