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Tag: Astra Space Inc

  • Astra founders offer to take company private at value of about $30 million

    Astra founders offer to take company private at value of about $30 million

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    Astra tests a rocket at its headquarters on the San Francisco Bay in Alameda, California.

    Astra

    The founders of struggling space company Astra have offered to take the company private at a value of about $30 million, according to a securities filing on Thursday.

    Chris Kemp, chairman and CEO, and Adam London, chief technology officer, delivered a proposal to the Astra board of directors on Wednesday to acquire all the company’s outstanding stock at $1.50 a share.

    That price is a 103% premium to Wednesday’s closing price at 74 cents a share, which represents a market value of about $16 million.

    “We believe that Astra’s strategic objectives and business prospects will be best served as a private company. Taking the company private while delivering a meaningful premium to current shareholders allows for the best interests of shareholders as well as the Company, its employees and its customers to be met,” Kemp and London wrote in a letter to the board.

    The founders anticipate raising $60 million to $65 million in capital to fund the take-private move, given the purchase price as well as transaction expenses and bridge financing. Kemp and London are also “open to certain accredited investor stockholders of the Company rolling their equity into the transaction.”

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    Astra’s rocket launching business has been on hiatus since a June 2022 mission failure. The company is running out of cash, with its acquired spacecraft propulsion business yet to drive meaningful quarterly revenue. Astra cut 25% of its workforce in early August to shift focus from its rocket development to its spacecraft engine production.

    Last month, Astra’s cash reserve slipped below $10.5 million and it defaulted on a debt raise, it disclosed on Friday. The company then on Monday raised financing from a pair of investors to pay off that outstanding debt.

    Astra went public via a SPAC merger at a $2.6 billion valuation in February 2021. The company aimed to cheaply and rapidly produce small rockets. While Astra reached orbit twice successfully, the company suffered three launch failures after going public.

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  • Astra conducts layoffs, raises debt and shifts focus to spacecraft engines in bid to survive

    Astra conducts layoffs, raises debt and shifts focus to spacecraft engines in bid to survive

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    An Astra Spacecraft Engine during testing.

    Astra

    Struggling space company Astra is cutting 25% of its workforce, the company announced Friday, and restructuring to focus more on its spacecraft engine business, which will delay progress on the small rocket it has been developing.

    Astra is cutting about 70 employees, as well as reallocating about 50 personnel from its rocket development program over to its space products unit, which builds the company’s spacecraft engines.

    “We are intensely focused on delivering on our commitments to our customers, which includes ensuring we have sufficient resources and an adequate financial runway to execute on our near-term opportunities,” Astra chairman and CEO Chris Kemp said in a statement.

    The workforce reductions are expected to result in $4 million in quarterly cost savings, beginning in the fourth quarter. Astra noted that it had 278 total orders for spacecraft engines, as of four months ago, worth about $77 million in contracts. It expects to deliver on “a substantial majority” of those orders by the end of 2024.

    In a separate filing Friday, Astra said it raised $10.8 million in net proceeds from selling debt to investment group High Trail Capital.

    Astra stock was little changed in after-hours trading Friday from its close at 38 cents a share.

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    Last year, Astra moved away from its Rocket 3.3 vehicle earlier than expected to focus on the next version, an upgraded system called Rocket 4.0, after its final Rocket 3.3 mission failed mid-launch. While the company was targeting a first launch of Rocket 4 by the end of this year, in a securities filing, Astra noted the prioritization of the spacecraft engine business “will affect the timing of the Company’s future test launches.”

    “The Company’s ability to conduct paid commercial launches in 2024 and beyond will depend on the ultimate timing and success of the initial test launches which will in turn depend on the resources that the Company is able to devote to Launch Systems development in the coming quarters,” Astra warned.

    The company also released preliminary second-quarter results. Astra expects it brought $1 million or less in revenue during the quarter, with a net loss between $13 million and $15 million, and a remaining amount of cash and securities of about $26 million. The company plans to report finalized second-quarter results Aug. 14.

    Last month, Astra finalized plans to conduct a reverse stock split at a 1 to 15 ratio. It’s also seeking to raise up to $65 million through an “at the market” offering of common stock through Roth Capital and ended a prior agreement with B. Riley to sell up to $100 million in common stock that the company signed a year ago.

    In Friday’s filing, Astra said it hired PJT Partners as a financial advisor, with the company “focused on thoughtfully pursuing opportunities to raise additional capital.”

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  • Virgin Orbit was a promising company that could never find a working business model

    Virgin Orbit was a promising company that could never find a working business model

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    Virgin Orbit started as a program of Richard Branson’s Virgin Galactic in 2012, before being spun off into a separate company five years later.

    In the private space race, Virgin Orbit contended its method of launching its rockets — known as “air launch” — was more flexible than traditional launch pads used by competitors like Rocket Lab, Astra and SpaceX.

    The company employed a modified Boeing 747 jet that it called “Cosmic Girl” to carry its LauncherOne rocket to about 35,000 feet of altitude before dropping it.

    From there, the rocket would fire its engines and fly off into space.

    “By launching from an aircraft, Virgin could take off from almost any airport around the world and turn these airports into space ports,” said Caleb Henry, director of research at Quilty Analytics.

    Henry noted that the Virgin Orbit’s last launch was from the United Kingdom, and that the company was in discussions to launch in Japan and Brazil.

    “They were offering to different countries the ability to, in a sense, have a sovereign launch capability, because the rocket would take off from their home soil,” Henry said.

    But Virgin Orbit was dogged by delays. The company originally hoped to launch its debut mission in 2018, but didn’t get off the ground until May of 2020. The demonstration mission failed shortly after the rocket was released. In total, the company launched six missions, four of which were successful and two of which failed, including the last one in January.

    Virgin Orbit’s biggest deal was a 39-launch contract signed with satellite maker OneWeb in 2015. OneWeb ultimately pulled out of the deal without conducting a single launch.

    “A challenge for the company, and for any launch company, is having an anchor customer, somebody who you can depend on to routinely buy a decent number of launches,” Henry said. “Virgin Orbit did not have an anchor customer.”

    In late March, Virgin Orbit said it was laying off the majority of its workforce and ceasing operations “for the foreseeable future” after failing to secure a funding lifeline. Days later, the company filed for bankruptcy.

    Watch the video to find out more about what led to Virgin Orbit’s collapse. 

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  • Rocket builder Astra Space gets delisting warning from Nasdaq

    Rocket builder Astra Space gets delisting warning from Nasdaq

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    A close up look at Astra’s LV0008 rocket at LC-46 in Cape Canaveral, Florida.

    John Kraus / Astra

    Embattled small rocket-builder Astra revealed Friday that it received a delisting warning from the Nasdaq after its stock spent 30 consecutive days below $1 per share, a violation of the exchange’s requirements.

    The company has 180 days to lift its share price or face delisting, according to a regulatory filing.

    Astra stock closed Friday at 59 cents per share, down more than 90% this year and more than 95% off its 52-week high of $13.58. The company debuted on the Nasdaq in July 2021 via a merger with a special purpose acquisition company.

    Astra did not immediately return request for comment Friday on the delisting warning.

    The rocket builder has been saddled with quarterly losses and in August said it was pausing flights for the remainder of the year.

    “Whether we’ll be able to commence commercial launches in 2023 will depend on the success of our test flights” for a new rocket system, CEO Chris Kemp said during the company’s second-quarter conference call.

    Astra is also facing a Federal Aviation Administration investigation into a failed rocket launch in June that was carrying a pair of satellites for NASA’s TROPICS-1 mission. The company was unable to deliver the satellites to orbit, and NASA put the remaining two launches it had contracted from Astra on hold.

    — CNBC’s Michael Sheetz contributed to this report.

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