Virgin Orbit, a space travel and launch company, has announced plans to cease its operations for the foreseeable future, along with eliminating 675 positions (accounting for ~85% of total positions) after the company failed to secure a funding lifeline for its operations.

The layoffs, which spans across all departments, will cost the company USD 8.8 million in severance payments and USD 6.5 million relating to outplacement services and regulatory compliance. To this end, Virgin Orbit has received a USD 10.9 million injection from Virgin Investments Ltd (VIL) in the form of a senior-secured convertible note.

Following the announcement, more than 40% of shares were unloaded by shareholders with the Virgin Orbit stock closing at USD 0.32 (down 82% since the beginning of the year)

Analyst QuickTake: This permanent ceasing of business activity follows Virgin Orbit’s temporary operational pause , which came into effect on 16 March, during which nearly all employees were furloughed. Without business activity to generate revenue, the company is likely to default on its repayment obligations to VIL, leading to the foreclosure of all Virgin Orbit’s respective assets and the exclusion of certain customary assets and permitted liens outlined in the respective convertible notes.