Once the merger closes, Virgin Galactic will have a valuation of $1.5 billion, with SCH retaining a 49% stake. Branson confirmed that he will retain his majority stake even after the company lists, saying he has no plans to sell his shares.
“I will retain control of the company,” Branson said. “I will keep roughly 51%.”
Virgin Galactic founder Richard Branson models the company’s new line of spacewear made by Under Armour.
CNBC | Michael Sheetz
Palihapitiya sees Virgin Galactic as “a business that has software-like margins,” telling CNBC in July that he believes there is a “really compelling risk-reward” behind space tourism. UBS, in a March report, estimated that space tourism has a potential market of $3 billion a decade from now, even though it’s “still at a nascent phase.”
Virgin Galactic’s spacecraft can carry as many as six passengers, along with the two pilots, to the edge of space. The spaceship is dropped from a jet-powered aircraft and fires a rocket motor, reaching over three times the speed of sound as it climbs though the Earth’s atmosphere. Then the spacecraft and its passengers float weightless for a few minutes, before gliding back down to land on Earth much like a traditional aircraft.
A ticket for a Virgin Galactic flight goes for about $250,000 per person, and the company has a list of 603 customers waiting to fly.
Expanding Virgin Galactic’s business internationally
Virgin Galactic has testing facilities in California’s Mojave Desert and has an agreement with Spaceport America in New Mexico for the first commercial flights. But Branson says that’s just the beginning for the space tourism business, as the company is talking about expanding across several continents.
“Abu Dhabi would like us to do a spaceport there, and we’re in discussions with them,” Branson said. “Italy would like us to do a spaceport there. Great Britain wants us to do a spaceport. Australia talked to us about doing a spaceport.”
Virgin Galactic is also looking to begin operations “in a few other, Asian countries,” CEO George Whitesides said. But perhaps the most fascinating opportunity may be in Scandinavia, as the company is speaking to Sweden about flying into the region’s spectacular night sky.
“We’ve talked about going up into the Northern Lights,” Branson said. “It would be ridiculous.”
As for the company’s first commercial flights, Branson expects to be on the first one — yet left it a mystery as to who else will fly with him.
“We have an announcement to make, so I’m not allowed to talk about it,” Branson said. “Sometime next year I will be taking somebody up, but I will have to let you know.”