To date, Virgin Galactic has been wholly owned and funded by Sir Richard Branson‘s Virgin Group. The agreement, signed at the EAA AirVenture air show in Oshkosh, Wisconsin, was attended by Sir Richard Branson, Founder of Virgin Group, and Mohamed Badawy Al-Husseiny, CEO of Aabar. The signing ceremony occurred alongside Virgin Galactic’s new carrier space launch vehicle, WhiteKnightTwo (VMS Eve) which is making its public demonstration flying debut in Oshkosh.
Under the deal, Aabar will invest approximately US$280m and acquire an approximate 32 percent stake in Virgin Galactic’s holding company, valuing the business at about $900m. The transaction is subject to obtaining regulatory clearances in the United States and elsewhere. Additionally, Aabar has committed $100m (plus transaction cost) to fund a small satellite launch capability, subject to the development of a full business plan. It will also gain exclusive regional rights, subject to regulatory clearances, to host Virgin Galactic tourism and scientific research space flights. Finally, Aabar has plans to build spaceport facilities in Abu Dhabi. Aabar’s stake in Virgin Galactic will open a new avenue of opportunity for Abu Dhabi in this unique and dynamic business. The significant partnership falls in line with Abu Dhabi’s larger plans to inculcate technology research and science at a grassroots level as well as complements its aim to be the international tourism capital of the region.
Virgin Galactic is in the final stages of developing and testing commercial sub-orbital space vehicles based on the prototype SpaceShipOne, that flew successfully to space and back three times in 2004. The unique and innovative designs of the vehicles will transform the cost, safety and environmental impact of access to space for people, science research and education. The new joint venture also proposes to undertake additional development which would enable the space system to launch small satellites at unprecedented levels of cost, reliability and flexibility. Virgin Group has invested over $100m in Virgin Galactic since its formation in late 2004. The development of its new vehicles is being carried out by Scaled Composites, the renowned Mojave, CA, based aeronautical firm, owned by Northrop Grumman and led by Burt Rutan. Scaled Composites was responsible for designing and building SpaceShipOne, which won the $10m X Prize in 2004 as the first privately funded manned space vehicle. The system is highly innovative: it uses a carrier aircraft for launch of the spaceship at high altitude, a controllable and benign hybrid rocket motor, and a unique wing feathering design for a failsafe re-entry. The spaceship makes a runway landing rendering it almost entirely reusable.
The new commercial vehicles are now at an advanced stage of development. VMS Eve, VG’s new carrier aircraft, is well into its test flight program and is performing flawlessly. It is the world’s largest all carbon composite aircraft and has a unique high altitude, heavy lift capability. The new spacecraft, SpaceShipTwo, will commence its own test flight program before the end of 2009. Both vehicles offer a unique environment for space tourism and a wide range of science research applications as well as a platform for small satellite launch. Virgin Galactic expects the capital infusion to fully fund the company through to its commencement of commercial operations. Credit Suisse acted as the exclusive financial advisor and placement agent to Virgin Galactic regarding the transaction. (Photo credits: Doug Messier, Parabolic Arc)
