Virgin Orbit gets approval of bid procedures, amended DIP facility

By Sarah Lizee

Olympia, Wash., May 1 – Virgin Orbit Holdings, Inc. received final approval of an amended $74.1 million debtor-in-possession facility and approval of bid procedures for its assets on Friday, according to orders filed with the U.S. Bankruptcy Court in the District of Delaware.

As previously reported, the financing is from parent company Virgin Investments Ltd. (VIL).

The facility consists of a $31.6 million new money super-priority senior secured term loan and a $42.5 million rollup of prepetition convertible notes.

As previously reported, the official committee of unsecured creditors had filed an objection to the financing on April 26.

However, following discussions between the debtor, DIP lender and committee, the May 1 hearing was uncontested.

Counsel for the debtor said at the hearing that the lender had agreed to reduce the 18% interest fee on the rollup to 12%.

The initial rollup fee, which is 3%, was removed.

Mandatory prepayments were also changed so that sweeps will start once excess cash hits $2.5 million, up from $2 million previously.

Under the approved bid procedures, the bid deadline is 4 p.m. ET on May 15, an auction will be held on May 18 and a sale hearing will take place on May 24.

The company is hoping to choose a stalking horse bidder for the assets and has until 4 p.m. ET on May 8 to do so.

Virgin Orbit wants to close the sale by June 2.

Long Beach, Calif.-based Virgin Orbit operates space launch systems. The company filed bankruptcy on April 4 under Chapter 11 case number 23-10405.

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