Virgin Orbit Holdings Inc (NASDAQ:VORB) has begun drawing up detailed contingency plans for its insolvency days after halting its operations and furloughing its workforce, according to reports.
Sky News has learnt that the commercial space satellite venture founded by Sir Richard Branson's Virgin Group is working with Alvarez & Marsal and Ducera, two restructuring firms, on fallback plans in the event that it cannot secure new funding.
The decision to line up the advisers underlines the parlous nature of Virgin Orbit's finances, even as it continues talks with a small number of prospective investors about providing sufficient funding to restart its operations, the report said.
Virgin Orbit is 75%-owned by Branson's holding company, with its shares listed on the Nasdaq exchange in New York.
Its value has further plummeted following the failure of its inaugural British mission in Cornwall in January.
Sources told Sky News that the insolvency planning work involving A&M and Ducera is being run out of the US.
A&M also worked on plans for the administration of Virgin Atlantic Airways as it raced to recapitalise itself during the COVID-19 pandemic.
Sources said that Boeing, which has previously invested in the company, is not in talks with it.